---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
20549

FORM 10-K

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

For the fiscal year ended December 31, 2015

OR

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

For the transition period from ___________________ to
___________________

Commission file number: 001-36204



ENERGY FUELS INC.(Exact
Name of Registrant as Specified in its Charter)

|Ontario, Canada                                  | 98-1067994                                
|------------------------------------------------ | ------------------------------------------
|(State of other jurisdiction of incorporation or | (I.R.S. Employer Identification
      No.)
|organization)                                    |                                           
|                                                 |                                           
|                                                 |                                           
|                                                 |                                           
|225 Union Blvd., Suite 600                       |                                           
|Lakewood, Colorado                               | 80228                                     
|(Address of Principal Executive Offices)         | (Zip Code)                                

(303) 389-4130(Registrants Telephone Number,
including Area Code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

|Title of Each Class         | Name of Each Exchange on Which Registered
|--------------------------- | -----------------------------------------
|Common Shares, no par value | NYSE MKT                                 

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None

---

Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act.Yes
[   ]        No [X]

Indicate by check mark if the registrant is not required to
file reports pursuant to Section 13 or Section 15(d) of the Act.Yes
[   ]        No [X]

Indicate by checkmark whether the registrant (1) filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes
[X]        No [   ]

Indicate by check mark whether the Registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
Yes [   ]        No
[   ]

Indicate by checkmark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the registrants knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to the Form 10-K. [   ]

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated filer. See the
definitions of large accelerated filer, accelerated filer, and smaller
reporting company in Rule 12b-2 of the Exchange Act (Check one):

Large Accelerated Filer [ 
 ]        Accelerated Filer
[X]        Non-Accelerated Filer [ 
 ]        Smaller Reporting Company
[   ]

Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Act). Yes [  
]        No [X]

State the aggregate market value of the voting and non-voting
common equity held by non-affiliates computed by reference to the price at which
the common equity was last sold, or the average bid and asked price of such
common equity, as of the last business day of the registrants most recently
completed second fiscal quarter: $194,565,882.

The number of shares of the Registrants common stock
outstanding as of March 14, 2016 was 51,889,545.

DOCUMENTS INCORPORATED BY REFERENCE

Certain information required for Items 10, 11, 12, 13 and 14 of
Part III of this Annual Report on Form 10-K is incorporated by reference to the
registrants definitive proxy statement for the 2016 Annual Meeting of
Shareholders.

---

TABLE OF CONTENTS

|PART
    I   | 1                                                                                                                                 
|------------ | ----------------------------------------------------------------------------------------------------------------------------------
|             | ITEM
      1. DESCRIPTION OF BUSINESS                                                                                             
|             | ITEM
      1A. RISK FACTORS                                                                                                       
|             | ITEM
      2. DESCRIPTION OF PROPERTIES                                                                                           
|             | ITEM
      3. LEGAL PROCEEDINGS                                                                                                   
|             | ITEM
      4. MINE SAFETY DISCLOSURE                                                                                              
|PART
    II  | 104                                                                                                                               
|             | ITEM
      5. MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES
|             | ITEM
      6. SELECTED FINANCIAL DATA                                                                                             
|             | ITEM
      7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
      OF OPERATIONS                         
|             | ITEM
      8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                         
|             | ITEM
      9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
      FINANCIAL DISCLOSURE                          
|             | ITEM
      9A. CONTROLS AND PROCEDURES                                                                                            
|             | ITEM
      9B. OTHER INFORMATION.                                                                                                 
|PART
    III | 127                                                                                                                               
|             | ITEM
      10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                             
|             | ITEM
      11. EXECUTIVE COMPENSATION                                                                                             
|             | ITEM
      12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
      RELATED STOCKHOLDER MATTERS               
|             | ITEM
      13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
      INDEPENDENCE                                     
|             | ITEM
      14. PRINCIPAL ACCOUNTANT FEES AND SERVICES                                                                             
|PART
    IV  | 129                                                                                                                               
|             | ITEM
      15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES                                                                         
|SIGNATURES   | 133                                                                                                                               

i

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report and the exhibits attached hereto (the
Annual Report) contain forward-looking statements within the meaning
of applicable US and Canadian securities laws. Such forward-looking statements
concern Energy Fuels Inc.s (the Companys or Energy Fuels) anticipated
results and progress of the Companys operations in future periods, planned
exploration, and, if warranted, development of its properties, plans related to
its business, and other matters that may occur in the future. These statements
relate to analyses and other information that are based on forecasts of future
results, estimates of amounts not yet determinable and assumptions of
management.

Any statements that express or involve discussions with respect
to predictions, expectations, beliefs, plans, projections, objectives,
schedules, assumptions, future events, or performance (often, but not always,
using words or phrases such as expects or does not expect, is expected,
anticipates or does not anticipate, plans, estimates or intends, or
stating that certain actions, events or results may, could, would, might
or will be taken, occur or be achieved) are not statements of historical fact
and may be forward-looking statements.

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, or incorporated by
reference into, this Annual Report should not be unduly relied upon. This
information speaks only as of the date of this Annual Report.

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 exploration,
development, operation, and closure of mineral properties and processing
facilities. Forward-looking statements are subject to a variety of known and
unknown risks, uncertainties and other factors which could cause actual events
or results to differ from those expressed or implied by the forward-looking
statements, including, without limitation:

| | risks associated with mineral reserve and resource
      estimates, including the risk of errors in assumptions or methodologies;                                                                                                                                                                                                 
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | risks associated with estimating mineral extraction and
      recovery, forecasting future price levels necessary to support mineral
      extraction and recovery, and the Companys ability to increase mineral
      extraction and recovery in response to any increases in commodity prices
      or other market conditions;
| | uncertainties and liabilities inherent to conventional
      mineral extraction and recovery and/or in-situ uranium recovery
      operations;                                                                                                                                                                                    
| | geological, technical and processing problems, including
      unanticipated metallurgical difficulties, less than expected recoveries,
      ground control problems, process upsets, and equipment malfunctions;                                                                                                                
| | risks associated with labor costs, labor disturbances,
      and unavailability of skilled labor;                                                                                                                                                                                                                                 
| | 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 mineral extraction and recovery levels and
      costs;                                  
| | actions taken by regulatory authorities with respect to
      mineral extraction and recovery activities;                                                                                                                                                                                                                         
| | risks associated with the Companys dependence on third
      parties in the provision of transportation and other critical services;                                                                                                                                                                                             
| | risks associated with the ability of the Company to
      extend or renew land tenure, including mineral leases and surface use
      agreements, on favorable terms or at all;                                                                                                                                                   

ii

---

| | risks associated with the ability of the Company to
      negotiate access rights on certain properties on favorable terms or at
      all;                                   
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 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 the Company to meet its obligations to its
      creditors;                                                                                                    
| | risks associated with paying off indebtedness at its
      maturity;                                                                                                          
| | 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, mineral
      properties, and skilled personnel;                                                                                
| | failure to complete proposed acquisitions and incorrect
      assessments of the value of completed acquisitions;                                                             
| | risks posed by fluctuations in share price levels,
      exchange rates and interest rates, and general economic conditions;                                                  
| | risks inherent in the Companys and industry analysts
      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;                                      
| | failure to obtain suitable uranium sales terms, including
      spot and term sale contracts;                                                                                 
| | risks associated with asset impairment as a result of
      market conditions;                                                                                                
| | 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 extraction
      and recovery;                                                                                                 
| | uranium industry competition and international trade
      restrictions;                                                                                                      
| | risks related to higher than expected costs related to
      our Nichols Ranch Project and Canyon Project;                                                                    
| | risks related to securities regulations;                                                                                                                                      
| | risks related to stock price and volume volatility;                                                                                                                           
| | risks related to our ability to maintain our listing on
      the NYSE MKT and Toronto Stock Exchanges;                                                                       
| | risks related to our ability to maintain our inclusion in
      various stock indices;                                                                                        
| | risks related to dilution of currently outstanding
      shares;                                                                                                              
| | risks related to our lack of dividends;                                                                                                                                       
| | risks related to recent market events;                                                                                                                                        
| | risks related to our issuance of additional common
      shares;                                                                                                              
| | risks related to acquisition and integration issues;                                                                                                                          
| | risks related to defects in title to our mineral
      properties;                                                                                                            
| | risks related to our outstanding debt; and                                                                                                                                    
| | risks related to our securities.                                                                                                                                              

This list is not exhaustive of the factors that may affect our
forward-looking statements. Some of the important risks and uncertainties that
could affect forward-looking statements are described further under the section
headings: Item 1. Description of the Business; Item 1A. Risk Factors; and Item
7. Managements Discussion and Analysis of Financial Condition and Results of
Operations of this Annual Report. Although we have attempted to identify
important factors that could cause actual results to differ materially from
those described in forward-looking statements, there may be other factors that
cause results not to be as anticipated, estimated or intended. Should one or
more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those
anticipated, believed, estimated, or expected. We caution readers not to place
undue reliance on any such forward-looking statements, which speak only as of
the date made. Except as required by law, we disclaim any obligation to
subsequently revise any forward-looking statements to reflect events or
circumstances after the date of such statements or to reflect the occurrence of
anticipated or unanticipated events. 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 may be
profitably extracted in the future.

iii

---

We qualify all the forward-looking statements contained in
this Annual Report by the foregoing cautionary statements.

CAUTIONARYNOTETOUNITEDSTATESINVESTORSCONCERNINGDISCLOSUREOFMINERALRESOURCES


This Annual Report contains certain disclosure that 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 Annual Report,
and in the documents incorporated by reference herein, 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 (CIM) 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 herein, or
incorporated by reference in this Annual Report, and in the documents
incorporated by reference herein, may not be comparable to similar information
disclosed by companies reporting under only United States standards. In
particular, and without limiting the generality of the foregoing, the term
resource does not equate to the term reserve under SEC Industry Guide 7.
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. Under SEC Industry Guide 7 standards, a final or
bankable feasibility study is required to report reserves; the three-year
historical average price, to the extent possible, is used in any reserve or cash
flow analysis to designate reserves; and the primary environmental analysis or
report must be filed with the appropriate governmental authority.

The SECs disclosure standards under Industry Guide 7 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 or contained ounces 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
Industry Guide 7 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.

As a company incorporated in Canada, unless otherwise
indicated, Energy Fuels estimates and
reports our resources and our current reserves according to the definitions set
forth in NI 43-101. Any reserves that are reported in this Form 10-K according
to the definitions set forth in NI 43-101 are reconciled to the reserves as
appropriate to conform to SEC Industry Guide 7 for reporting in the U.S. The definitions for each reporting
standard are presented below with supplementary explanation and descriptions of
the parallels and differences.

iv

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CIM and NI 43-101 Definitions:

| | Feasibility Study:A feasibility study is a
      comprehensive technical and economic study of the selected development
      option for a mineral project that includes appropriately detailed
      assessments of applicable modifying factors, together with any other
      relevant operational factors and detailed financial analysis that are
      necessary to demonstrate, at the time of reporting, that extraction is
      reasonably justified (economically minable). The results of the study may
      reasonably serve as the basis for a final decision by a proponent or
      financial institution to proceed with, or finance, the development of the
      project. The confidence level of the study will be higher than that of a
      pre-feasibility study.                                                                                                                                                                                                                                                              
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Indicated Mineral Resource1:An indicated mineral resource is that part of a mineral resource for
      which quantity, grade or quality, densities, shape and physical
      characteristics are estimated with sufficient confidence to allow the
      application of modifying factors in sufficient detail to support mine
      planning and evaluation of the economic viability of the deposit.
      Geological evidence is derived from adequately detailed and reliable
      exploration, sampling and testing and is sufficient to assume geological
      and grade or quality continuity between points of observation. An
      indicated mineral resource has a lower level of confidence than that
      applied to a measured mineral resource and may only be converted to a
      probable mineral reserve.                                                                                                                                                                                                                         
| | Inferred Mineral Resource2:An inferred mineral resource is that part of a mineral resource for
      which quantity and grade or quality are estimated on the basis of limited
      geological evidence and sampling. Geological evidence is sufficient to
      imply, but not verify, geological and grade or quality continuity. An
      inferred mineral resource has a lower level of confidence than that
      applied to an indicated mineral resource and must not be converted to a
      mineral reserve. It is reasonably expected that the majority of inferred
      mineral resources could be upgraded to indicated mineral resources with
      continued exploration.                                                                                                                                                                                                                                                                                                                                                               
| | Measured Mineral Resource3:A measured mineral resource is that part of a mineral resource for
      which quantity, grade or quality, densities, shape and physical
      characteristics are estimated with confidence sufficient to allow the
      application of modifying factors to support detailed mine planning and
      final evaluation of the economic viability of the deposit. Geological
      evidence is derived from detailed and reliable exploration, sampling, and
      testing and is sufficient to confirm geological and grade or quality
      continuity between points of observation. A measured mineral resource has
      a higher level of confidence than that applied to either an indicated
      mineral resource or an inferred mineral resource. It may be converted to a
      proven mineral reserve or to a probable mineral reserve.                                                                                                                                                                         
| | Mineral Reserve4:A
      mineral reserve is the economically mineable part of a measured and/or
      indicated mineral resource. It includes diluting materials and allowances
      for losses which may occur when the mineral is mined or is extracted and
      is defined by studies at pre-feasibility or feasibility level as
      appropriate that include application of modifying factors. Such studies
      demonstrate that, at the time of reporting, extraction could reasonably be
      justified. The reference point at which mineral reserves are defined,
      usually the point where the ore is delivered to the processing plant, must
      be stated. It is important that, in all situations where the reference
      point is different, such as for a saleable product, a clarifying statement
      is included to ensure that the reader is fully informed as to what is
      being reported. The public disclosure of a mineral reserve must be
      demonstrated by a pre-feasibility study or feasibility study.
| | Mineral Resource5:A
      mineral resource is a concentration or occurrence of solid material of
      economic interest in or on the Earths crust in such form, grade or
      quality and quantity that there are reasonable prospects for eventual
      economic extraction. The location, quantity, grade or quality, continuity
      and other geological characteristics of a mineral resource are known,
      estimated or interpreted from specific geological evidence and knowledge,
      including sampling.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

______________________________________1 SEC
Industry Guide 7 does not recognize the designation of a deposit as an
Indicated Mineral Resource. 2 SEC Industry Guide 7 does not
recognize the designation of a deposit as an Inferred Mineral Resource.
3 SEC Industry Guide 7 does not recognize the designation of a
deposit as a Measured Mineral Resource. 4 SEC Industry Guide 7
does not recognize reserves calculated in accordance with NI 43-101.
5 SEC Industry Guide 7 does not recognize the designation of a
deposit as a Mineral Resource.

v

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| | Modifying Factors: Modifying factors are
      considerations used to convert mineral resources to mineral reserves.
      These include, but are not restricted to, mining, processing,
      metallurgical, infrastructure, economic, marketing, legal, environmental,
      social, and governmental factors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Pre-Feasibility Study:A pre-feasibility study
      is a comprehensive study of a range of options for the technical and
      economic viability of a mineral project that has advanced to a stage where
      a preferred mining method, in the case of underground mining, or the pit
      configuration, in the case of an open pit, is established and an effective
      method of mineral processing is determined. It includes a financial
      analysis based on reasonable assumptions on the modifying factors and the
      evaluation of any other relevant factors which are sufficient for a
      qualified person, acting reasonably, to determine if all or part of the
      mineral resource may be converted to a mineral reserve at the time of
      reporting. A pre-feasibility study is at a lower confidence level than a
      feasibility study.                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Probable Mineral Reserve6:A probable mineral reserve is the economically mineable part of an
      indicated, and in some circumstances, a measured mineral resource. The
      confidence in the modifying factors applied to a probable mineral reserve
      is lower than that applied to a proven mineral reserve.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Proven Mineral Reserve7:A proven mineral reserve is the economically minable part of a
      measured mineral resource. A proven mineral reserve implies a high degree
      of confidence in the modifying factors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | Qualified Person8:A
      qualified person is an individual who: (a) is an engineer or
      geoscientist with a university degree, or equivalent accreditation, in an
      area of geoscience or engineering, relating to mineral exploration or
      mining; (b) has at least five years of experience in mineral exploration,
      mine development or operation, or mineral project assessment, or any
      combination of these, that is relevant to his or her professional degree
      or area of practice; (c) has experience relevant to the subject matter of
      the mineral project and technical report; (d) is in good standing with a
      professional association; and (e) in the case of a professional
      association in a non-Canadian jurisdiction, has a membership designation
      that (i) requires attainment of a position of responsibility in his or her
      profession that requires the exercise of independent judgment; and (ii)
      requires (A) a favorable confidential peer evaluation of the individuals
      character, professional judgement, experience, and ethical fitness; or (B)
      a recommendation for membership by at least two peers, and demonstrated
      prominence or expertise in the field of mineral exploration or mining.

SEC Industry Guide 7 Definitions:

| | Exploration Stage (sometimes referred to as
      "Exploration State"):Includes all issuers engaged in
      the search for mineral deposits (reserves) which are not in either the
      development or production stage.                                                                                                                                                                                                                                                 
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Development Stage:Includes all issuers engaged in
      the preparation of an established commercially mineable deposit (reserves)
      for its extraction which are not yet in the production stage.                                                                                                                                                                                                                                                                     
| | Probable (Indicated) Reserves:Reserves for which
      quantity and grade and/or quality are computed from information similar to
      that used for proven (measured) reserves, but the sites for inspection,
      sampling and measurement are farther apart or are otherwise less
      adequately spaced. The degree of assurance, although lower than that for
      proven reserves, is high enough to assume continuity between points of
      observation.      
| | Production Stage:Includes all issuers engaged in
      the exploitation of a mineral deposit (reserve).                                                                                                                                                                                                                                                                                                                                                                    
| | Proven (Measured) Reserves:Reserves for which (a)
      quantity is computed from dimensions revealed in outcrops, trenches,
      working, or drill holes; grade and/or quality are computed from the
      results of detailed sampling and (b) the sites for inspection, sampling
      and measurement are spaced so closely and the geological character is so
      well defined that size, shape, depth, and mineral content of reserves are
      well established.

__________________________________________6 SEC
Industry Guide 7 does not recognize reserves calculated in accordance with NI
43-101. SEC
Industry Guide 7 requires a final or bankable feasibility study for the
designation of a deposit as a reserve that must include adequate information
on mining, processing, metallurgical, economic, and other relevant factors that
demonstrate, at the time of reporting, that economic extraction is justified.
Further, all necessary permits must have been filed with the appropriate
regulatory authorities including the primary environmental analysis or report.
7 SEC Industry Guide 7 does not recognize reserves calculated
in accordance with NI 43-101. SEC Industry Guide 7 requires a final or bankable feasibility
study for the designation of a deposit as a reserve that must include adequate
information on mining, processing, metallurgical, economic, and other relevant
factors that demonstrate, at the time of reporting, that economic extraction is
justified. Further, all necessary permits must have been filed with the
appropriate regulatory authorities including the primary environmental analysis
or report. 8 SEC Industry Guide 7 does not require designation of
a qualified person.

vi

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| | Reserve:That part of a mineral deposit which
      could be economically and legally extracted or produced at the time of the
      reserve determination.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------

Note: as the Company does not have any mineral reserves within
the meaning of SEC Industry Guide 7, it is considered to be in an Exploration
Stage, regardless of its uranium recovery activities.

GLOSSARY OF TECHNICAL TERMS

The following defined technical terms are used in this Annual
Report:

Breccia:A rock in which angular fragments are
surrounded by a mass of fine-grained materials.

Cut-off or cut-off grade:When determining economically
viable mineral reserves, the lowest grade of mineralized material that can be
mined economically. When determining mineral resources, the lowest grade of
mineralized material included in the resources estimate.

eU3O8:This term refers to equivalent U3O8 grade derived by
gamma logging of drill holes.

EA: Environmental Assessment prepared under NEPA for a
mineral project.

EIS: Environmental Impact Statement prepared under NEPA for a
mineral project.

Extraction:The process of physically extracting mineralized
material from the ground. Exploration continues
during the extraction process and, in many cases, mineralized material is
expanded during the life of the extraction activities as the exploration
potential of the deposit is realized.

Formation:A distinct layer of sedimentary or volcanic
rock of similar composition.

Grade:Quantity or percentage of metal per unit weight
of host rock.

Host Rock:The rock containing a mineral or an ore body.

In-situ recovery (ISR):The recovery, by chemical means,
of the uranium component of a deposit without the physical extraction of
uranium-bearing material from the ground. ISR utilizes injection of appropriate
oxidizing chemicals into a uranium-bearing sandstone deposit with of the
uranium-bearing solution by extraction by wells; also referred to as solution
mining.

Mineral:A naturally formed chemical element or compound
having a definite chemical composition and, usually, a characteristic crystal
form.

Mineralization:A natural occurrence, in rocks or soil,
of one or more metal yielding minerals.

Mineralized material:Material that contains
mineralization (i.e., uranium or vanadium) and that is not included in an SEC Reserve as it
does not meet all of the criteria for adequate demonstration of economic or
legal extraction.

National Instrument 43-101 (NI 43-101):The National
Instrument regarding standards of disclosure for mineral projects in Canada.

NEPA: The United States National Environmental Policy
Act of 1969, as amended.

Open pit:Surface mineral extraction in which the
mineralized material is extracted from a pit or quarry.

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Ore:Mineral bearing rock that can be mined, processed
and concentrated profitably under current or immediately foreseeable economic
conditions. Under SEC Industry Guide 7, a company may only refer to reserves (as
that term is defined in SEC Industry Guide 7) as ore.

Ore body:A mostly solid and fairly continuous mass of
in-ground mineralization that is estimated to be economically mineable.

Outcrop: That part of a geologic formation or structure
that appears at the surface of the Earth.

PEA: A Preliminary Economic Assessment performed under
NI 43-101. A Preliminary Economic Assessment is a study, other than a
pre-feasibility study or feasibility study, which includes an economic analysis
of the potential viability of mineral resources.

PO: Plan of Operations for a mineral project prepared in
accordance with applicable U.S. Bureau of Land Management or U.S. Forest Service
regulations.

Reclamation:The process by which lands disturbed as a
result of mineral extraction activities are modified to support beneficial land
use. Reclamation activity may include the removal of buildings, equipment,
machinery, and other physical remnants of mining activities, closure of tailings
storage facilities, leach pads, and other features, and contouring, covering and
re-vegetation of waste rock, and other disturbed areas.

SEC Industry Guide 7:U.S. reporting guidelines that
apply to registrants engaged, or to be engaged, in significant mining
operations.

Uranium:a heavy, naturally radioactive, metallic
element of atomic number 92. Uranium in its pure form is a heavy metal. Its two
principal isotopes are U-238 and U-235, of which U-235 is the necessary
component for the nuclear fuel cycle. However, uranium used in this Annual
Report refers to triuranium octoxide, also called U3O8
or yellowcake, and is produced from uranium deposits. It is the most actively
traded uranium-related commodity.

**Uranium concentrate:** a yellowish to
yellow-brownish powder obtained from the chemical processing of uranium-bearing
material. Uranium concentrate typically contains 70% to 90% U3O8by weight. Uranium concentrate is also referred to as yellowcake.

V2O5: Vanadium pentoxide, or the
form of vanadium typically produced at the White Mesa Mill, also called blackflake.

viii

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PART I

ITEM 1. DESCRIPTION OF BUSINESS

General Development of the Business

Corporate Structure

Energy Fuels Inc. was incorporated on June 24, 1987 in the
Province of Alberta under the name 368408 Alberta Inc. In October 1987, 368408
Alberta Inc. changed its name to Trevco Oil & Gas Ltd. In May 1990, Trevco
Oil & Gas Ltd. changed its name to Trev Corp. In August 1994, Trev Corp.
changed its name to Orogrande Resources Inc. In April 2001 Orogrande Resources
Inc. changed its name to Volcanic Metals Exploration Inc. On September 2,
2005, the Company was continued under the Business Corporations Act
(Ontario). On March 26, 2006, Volcanic Metals Exploration Inc. acquired 100% of
the outstanding shares of Energy Fuels Resources Corporation. On May 26, 2006,
Volcanic Metals Exploration Inc. changed its name to Energy Fuels Inc. On
November 5, 2013, the Company amended its Articles to consolidate its issued and
outstanding common shares on the basis of one post-consolidation common share
for every 50 pre-consolidation Common Shares.

The registered and head office of Energy Fuels is located at 80
Richmond Street West, Victory Building, 18th Floor, Toronto, Ontario,
M5H 2A4, Canada. Energy Fuels conducts its business and owns its assets in the
United States through its U.S. subsidiaries, which have their principal place of
business and corporate office at 225 Union Blvd., Suite 600, Lakewood, Colorado
80228, USA. Energy Fuels website address is www.energyfuels.com.

Energy Fuels is a U.S. domestic issuer for SEC reporting
purposes and is a reporting issuer in all of the Canadian provinces. Energy
Fuels common shares (the Common Shares) are listed on the NYSE MKT
under the symbol UUUU and on the Toronto Stock Exchange (the TSX)
under the symbol EFR. In addition, Energy Fuels convertible 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. KCG Americas LLC is the
Companys Market Maker on the NYSE MKT.

The Company conducts its uranium extraction, recovery, and
sales business, and owns its properties, through a number of subsidiaries. A
diagram depicting the organizational structure of the Company and its active
subsidiaries, including the name, country of incorporation, and proportion of
ownership interest, is included as Exhibit 21.1 to this Annual Report. All of
the Companys U.S. assets are held directly or indirectly through the Companys
wholly-owned subsidiaries Energy Fuels Holdings Corp. (EF Holdings) and
Strathmore Minerals Corp. (Strathmore). EF Holdings and Strathmore hold
all or a portion of their uranium extraction, recovery, permitting, evaluation
and exploration assets through a number of additional subsidiaries, as detailed
below. Energy Fuels also owns a number of inactive subsidiaries which have no
material liabilities or assets and do not engage in any material business
activities.

All of the U.S. properties are operated by Energy Fuels
Resources (USA) Inc. (EFUSA), a wholly-owned subsidiary of EF Holdings.

In addition, the Company holds 9,439,857 shares of Virginia
Energy Resources Inc. (TSX.V:VUI; OTCQX:VEGYF) representing an approximate 16.5%
equity interest in that company, and 14,250,000 common shares of enCore Energy
Corp (TSX.V:UE) representing an approximate 19.9% equity interest in that
company.

Business Overview

Energy Fuels is engaged in conventional and in situ
(ISR) uranium extraction and recovery, along with the exploration,
permitting, and evaluation of uranium properties in the United States. Energy
Fuels owns the Nichols Ranch Uranium Recovery Facility in Wyoming (the
Nichols Ranch Project), which is one of the newest uranium recovery
facilities operating in the United States. In addition, Energy Fuels owns the
White Mesa Mill in Utah (the White Mesa Mill or Mill), which
is the only conventional uranium recovery facility operating in the United
States. The Company also owns uranium and uranium/vanadium properties and
projects in various stages of exploration, permitting, and evaluation, as well
as fully-permitted uranium and uranium/vanadium projects on standby. The White
Mesa Mill can also recover vanadium as a co-product of mineralized material
produced from certain of its projects in Colorado and Utah. In addition, Energy
Fuels recovers uranium from other uranium-bearing materials not derived from
conventional material, referred to as alternate feed materials, at its White
Mesa Mill.

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The Companys activities are divided into two segments: the
ISR Uranium Segment and the Conventional Uranium Segment.

ISR Uranium Segment

The Company conducts its ISR activities through its Nichols
Ranch Project, located in northeast Wyoming, which it acquired in June 2015
through its acquisition of Uranerz Energy Corporation (Uranerz). The
Nichols Ranch Project includes: (i) a licensed and operating ISR processing
facility (the Nichols Ranch Plant); (ii) licensed and operating ISR
wellfields (the Nichols Ranch Wellfields); (iii) planned ISR wellfields
currently
in the licensing process (the Jane Dough Property), and; (iv) a licensed satellite
ISR uranium project (the Hank Project), which will include an ISR
processing plant (the Hank Satellite Plant) that, when constructed,
will produce loaded-resin, and associated planned wellfields (the Hank
Property). See The Nichols Ranch ISR Project under Item 2 below.
Also through the acquisition of Uranerz, the Company acquired the Reno Creek
property (the Reno Creek Property), West North Butte property (the
West North Butte Property), and the North Rolling Pin property (the
North Rolling Pin Property), as well as the Arkose Mining Venture (the
Arkose Mining Venture), which is a joint venture of Wyoming ISR
properties held 81% by Energy Fuels. See Non-Material Mineral Properties 
Other ISR Projects under Item 2 below. All of the Companys ISR properties
are held by the Companys wholly-owned subsidiary, Uranerz.

The Nichols Ranch Project is an operating ISR facility that
recovers uranium through a series of injection and recovery wells. Using
groundwater fortified with oxygen and sodium bicarbonate, uranium is dissolved
within a deposit. The groundwater is then collected in a series of recovery
wells and pumped to the Nichols Ranch Plant. The Nichols Ranch Plant creates a
yellowcake slurry that is transported by truck to the White Mesa Mill, where it
is dried and packaged into drums that are shipped to uranium conversion
facilities.

Construction of the Nichols Ranch Plant, other than the
elution, drying and packaging circuits, was completed in 2013, and it commenced
uranium recovery activities in the second quarter of 2014. In September of 2015,
the Company commenced construction of an elution circuit at the Nichols Ranch
Plant, which was completed and began operations in February 2016. During 2015, a
total of 273,000 pounds of U3O8 were recovered from the
Nichols Ranch Project, of which approximately 172,000 pounds were recovered by
the Company after its acquisition of Uranerz in June 2015.

Additionally, the Company announced on March 4, 2016 that it
entered into a definitive agreement to acquire Mesteña Uranium LLC, which
includes additional ISR properties located in Brooks and Jim Hogg Counties,
Texas, as described below in Subsequent Events of this Item 1.

Conventional Uranium Segment

The Company conducts its conventional uranium extraction and
recovery activities through its White Mesa Mill, which is the only operating
conventional uranium mill in the United States. The White Mesa Mill, located
near Blanding Utah, is centrally located such that it can be fed by a number of
the Companys uranium and uranium/vanadium projects in Colorado, Utah, Arizona
and New Mexico, as well as by ore purchases or toll milling arrangements with
third party miners in the region as market conditions warrant.

The White Mesa Mill is a 2,000 ton per day uranium recovery
facility, which can also process vanadium as a co-product of mineralized
material extracted from certain uranium/vanadium properties. In addition, the
Mill can recycle other uranium-bearing materials not derived from conventional
ore, referred to as "alternate feed materials", for the recovery of uranium,
alone or in combination with other metals.

The White Mesa Mill has historically operated on a campaign
basis, whereby mineral processing occurs as mill feed, contract requirements,
and market conditions warrant. Over the years, the Companys own, and
third-party owned, conventional uranium properties in Utah, Colorado, Arizona
and New Mexico have been both active and on standby, from time-to-time, in
response to changing market conditions. From 2007 through 2014, running on a
campaign basis, the White Mesa Mill recovered on average over 1 million pounds
of  U3O8 per year from conventional sources,including its La Sal Project, Daneros Project, and Tony M property in
Utah; its Arizona 1 and Pinenut Projects in Arizona; and alternate feed
materials. During 2015, the Mill recovered a total of 296,000 lbs. of 
U3O8, of which 25,000 pounds were recovered from
conventional materials and the remainder from processing alternate feed materials (including 72,000 pounds for the account of a third
party). Between campaigns, the Mill is maintained on standby status, ready to
resume mineral processing activities, as market conditions warrant.

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The Companys Pinenut Project, where mineral extraction
activities occurred until September 2015, is now depleted, and reclamation
activities have commenced. Approximately 43,000 tons of mineralized material
extracted from the Pinenut Project is currently stockpiled at the White Mesa
Mill. The Company is also continuing to receive and stockpile alternate feed
materials at the White Mesa Mill for a future mineral processing campaign. At
the Companys permitted Canyon Project, shaft-sinking activities are currently
taking place. The Company expects to complete an underground drilling program at
the Canyon Project during 2016. The timing to extract and process mineralized
material from the Canyon Project will be based on the results of this additional
evaluation work, along with market conditions, available financing, and sales
requirements. All of the Companys other conventional properties and projects
are currently in the permitting process or on standby pending improvements in
market conditions. No third party conventional properties are active at this
time.

The Company also owns the Sheep Mountain Project (the Sheep
Mountain Project), which is a conventional uranium extraction project
located in Wyoming in an advanced stage of permitting. Due to its distance from
the White Mesa Mill, the Sheep Mountain Project is not expected to be a source
of feed material for the Mill. The Sheep Mountain Project consists of open pit
and underground extraction components (the Sheep Mountain Extraction
Operation) and a planned processing facility to process extracted
mineralized material (the Sheep Mountain Processing Operation).

The Companys principal conventional properties include the
following:

| | the White Mesa Mill, a 2,000 ton per day uranium and
      vanadium processing facility located near Blanding, Utah, held through the
      Companys subsidiary EFR White Mesa LLC. See The White Mesa Mill
      under Item 2 below;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | the Arizona Strip uranium properties located in north
      central Arizona, including: the Canyon Project, which is a fully-permitted
      uranium project with all surface facilities in place and shaft-sinking
      underway (see The Canyon Project under Item 2 below); the
      Wate project (the Wate Project), which is a uranium deposit in
      the permitting stage; the Arizona 1 project (the Arizona 1
      Project), which is a fully-permitted uranium project on standby; the
      Pinenut Project which is a depleted uranium deposit in reclamation; and
      the EZ properties (EZ Properties), which are uranium
      deposits in the exploration and evaluation stage. All of the Companys
      Arizona Strip properties are held by the Companys subsidiary EFR Arizona
      Strip LLC, with the exception of the Wate Project, which is held by the
      Companys subsidiary Wate Mining Company LLC. See Non-Material
      Mineral Properties  Other Conventional Projects  Arizona Strip
      under Item 2 below;
| | a 60% interest in the Roca Honda uranium project (the
      Roca Honda Project), which is located near the town of Grants,
      New Mexico, held by the Companys subsidiaries Strathmore Resources (US),
      Ltd., and Roca Honda Resources LLC. The Company has signed a non-binding
      letter of intent to acquire the other 40% interest in the Roca Honda
      Project from its joint venture partner. See The Roca Honda
      Project under Item 2 below;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | the Sheep Mountain Project, which is a uranium project
      located near Jeffrey City, Wyoming, including open pit and underground
      components in an advanced stage of permitting, held by the Companys
      subsidiary Energy Fuels Wyoming Inc. See The Sheep Mountain
      Project under Item 2 below;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | the Henry Mountains complex of uranium projects (the
      Henry Mountains Complex), located in south central Utah near the
      town of Ticaboo, which is comprised of the Tony M property (the Tony M
      Property) and the Bullfrog property (the Bullfrog Property),
      and which are held by the Companys subsidiary EFR Henry Mountains LLC.
      See The Henry Mountains Complex under Item 2 below;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | the La Sal complex of uranium and uranium/vanadium
      projects (the La Sal Project) (see The La Sal
      Project under Item 2 below), the Whirlwind uranium/vanadium
      project (the Whirlwind Project), and the Sage Plain
      uranium/vanadium project (the Sage Plain Project), all of which
      are located near the Colorado/Utah border (the Colorado Plateau)
      and, in addition to nearby exploration properties, are held by the
      Companys subsidiary EFR Colorado Plateau LLC. See Non-Material
      Mineral Properties  Other Conventional Projects  Colorado
      Plateau under Item 2 below;                                                                                                                                                                                                                                                                                                                                                                                                                          
| | the Daneros uranium project (the Daneros
      Project) located in the White Canyon district in southeastern Utah,
      which is held by the Companys subsidiary EFR White Canyon Corp. See
      The Daneros Project under Item 2 below; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | a number of non-core uranium properties, which the
      Company is evaluating for sale or abandonment, which are held in various
      of the Companys subsidiaries. See Non-Material Mineral
      Properties under Item 2 below.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

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Mineral Exploration

Energy Fuels holds a number of exploration properties in the
Colorado Plateau, White Canyon, Grants, Arizona Strip, and Powder River Basin
Districts. Energy Fuels has conducted intermittent exploration drilling on
numerous projects in the period from February 2007 through December 2013.
Several of those projects have been abandoned or sold. No exploration drilling
was performed in 2014 or 2015. See Non-Material Mineral Properties
under Item 2 below.

Development of the Business -- Major Transactions over the
Past Five Years

Over the past five years, the Company has completed the
following major transactions:

| | In February 2012, the Company
      acquired all of the outstanding shares of Titan Uranium Inc. Under that
      transaction, the Company acquired its 100% interest in the Sheep Mountain
      Project and Energy Fuels Wyoming Inc., the subsidiary that currently holds
      that asset (see The Sheep Mountain Project  History under Item 2
      below);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In June 2012, the Company
      acquired all of the outstanding shares of the U.S. subsidiaries of Denison
      Mines Corp. (the US Mining Division). Under that transaction, the
      Company acquired its 100% interest in the White Mesa Mill (see The
      White Mesa Mill  History under Item 2 below), the Arizona Strip
      Properties, other than the Wate Project (see The Canyon Project 
      Historyand Non-Material Mineral Properties  Other
      Conventional Projects  Arizona Strip under Item 2 below), the
      Henry Mountains Complex (see The Henry Mountains Complex 
      History under Item 2 below), the La Sal Project (see The La Sal
      Project  History under Item 2 below), the Daneros Project (see
      The Daneros Project  History under Item 2 below), and the
      Companys existing subsidiaries that currently hold those assets, as well
      as a number of uranium sales contracts and other assets;
| | In October 2013, the Company
      acquired all of the outstanding shares of Strathmore Minerals Corp. Under
      that transaction, the Company acquired its 60% interest in the Roca Honda
      Project (see The Roca Honda Project  History under Item 2
      below), which is held in a joint venture entity called Roca Honda
      Resources LLC, as well as the Companys 100% interests in the Gas Hills
      Project and Juniper Ridge Project (see Non-Material Mineral
      Properties  Other Conventional Projects under Item 2 below) as well
      as other assets, which are held in  the Companys subsidiary,
    Strathmore Resources (US), Ltd.;                                                                                                                                                                                                                                                                                                      
| | In two transactions in 2014, the
      Company sold its interest in the Pinon Ridge uranium/vanadium mill
      project, which is located in western Colorado, that the Company had
      previously planned to develop, along with a number of non-core uranium
      properties;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | In June 2015, the Company
      acquired all of the outstanding shares of Uranerz. Under that transaction,
      the Company acquired all of the Companys current ISR facilities, assets,
      and properties (other than those in the Shirley Basin), including the
      Nichols Ranch Project, the Hank Project, the Reno Creek Property, the West
      North Butte Property, the North Rolling Pin Property, the Companys
      interest in the Arkose Mining Venture, uranium sales contracts, and other
      assets, as well as the shares of Uranerz, which holds those assets. See
      2015 Corporate Developments below; and                                                                                                                                                                                                                                                                                                                                     
| | In two separate transactions in
      February and November of 2015, the Company acquired 100% ownership of the
      Wate Project, through the acquisition of Wate Mining Company LLC (see
      2015 Corporate Developments below).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

2015 Corporate Developments

On January 5, 2015, the Company announced that it had entered
into an Agreement and Plan of Merger (the Merger Agreement) with
Uranerz and EFR Nevada Corp., a Nevada corporation and wholly owned subsidiary
of the Company (Merger Sub). The Merger Agreement provided for a
business combination between Uranerz and Merger Sub, whereby the Company would
acquire all of the issued and outstanding shares of Uranerz. On June 18, 2015,
the acquisition was consummated, and Uranerz became a wholly-owned subsidiary of
the Company. At that time, two additional directors were appointed to the Board
of Directors of Energy Fuels, and each issued and outstanding share of Uranerz
was canceled and automatically converted into the right to receive 0.255 common
shares of the Company. The Company issued an aggregate of 24,457,773 Common
Shares in exchange for all of the issued and outstanding shares of Uranerz
common stock. In addition, the Company reserved for issuance an aggregate of
2,690,250 Common Shares for issuance upon exercise of Uranerz warrants, and
2,048,408 Common Shares for issuance pursuant to Uranerz stock options. Through
the Uranerz acquisition, the Company added its ISR Uranium Segment, as further
discussed above in this Item 1.

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On February 17, 2015, the Company acquired a 50% interest in
the Wate Project from VANE Minerals (US) LLC (VANE). The Wate Project
is held in the Companys subsidiary, Wate Mining Company, LLC (WMCL).
As consideration for the 50% interest in WMCL, the Company paid VANE $0.25
million cash at closing, along with a $0.50 million non-interest-bearing
promissory note, payable in two equal installments of $0.25 million each on the
first and second anniversaries of the note, and a 2% production royalty on the
50% interest in the Wate Project being acquired. The royalty can be purchased by
Energy Fuels upon payment to VANE of an additional $0.75 million. In addition,
upon the satisfaction of certain permitting milestones and other conditions, the
amounts due under the note will be accelerated, and the Company will pay to VANE
an additional $0.25 million cash. If Energy Fuel elects not to make the payments
under the note, it will be required to transfer this interest in WMCL interest
back to VANE. The terms of the note were amended on February 15, 2016. See
Subsequent Events below. On November 4, 2015, the Company announced
that it acquired the other 50% of WMCL from Anfield Resources Holding Corp.
(Anfield). The Company paid Anfield $0.275 million in cash and 92,906
Common Shares, having a market value of $0.275 million at the time of issuance.
In addition, after mineral extraction commences from the property, the Company
is required to make an additional cash payment of $0.275 million to Anfield and
issue to Anfield additional Common Shares having a value of $0.275 million. As a
result of the two foregoing transactions, the Company now owns a 100% interest
in the Wate Project and WMCL.

In two separate announcements on July 16, 2015 and July 21,
2015, respectively, the Company announced two key permitting milestones. The
State of Wyoming granted the Company approval for a major revision to the
existing permit for the Companys Sheep Mountain Project, including expansion of
surface and underground mining activities. In addition, the U.S. Bureau of Land
Management (BLM) issued a Final EA and granted its final approval for
the PO for the Companys 100%-owned Hank Project. The issuance of the EA and
approval of the PO were the final major regulatory approvals required to
construct the Hank Project in the future as a satellite to our Nichols Ranch
Project.

On August 3, 2015, the Company completed the acquisition of
mineral properties adjacent to its Roca Honda Project from Uranium Resources,
Inc. (URI). The Roca Honda Project is held by the Companys 60%
subsidiary, Roca Honda Resources LLC (RHR), with the remaining 40% held
by subsidiaries of Sumitomo Corporation (Sumitomo), currently the
Companys joint venture partner. RHR declined its option to have the properties
included in the joint venture due to Sumitomo's decision to sell its interest in
RHR. The Company has subsequently entered into a
non-binding letter of intent to purchase Sumitomos 40% interest in RHR. See
Subsequent Events below. The acquired properties, which total
approximately 4,580 acres (1,854 hectares), include: fee mineral ownership of
640 acres (Section 17); fee ownership of 36 unpatented lode mining
claims; and a leasehold interest in 131 unpatented lode mining claims. As
consideration for acquiring such properties, the Company delivered to URI: $2.5
million cash; $375,000 of Common Shares; the royalty held by the Company on
certain properties included within later phases of Peninsula Energys Lance
Uranium Project in Wyoming; unpatented lode mining claims adjacent to URIs
Church Rock property; and a 4% gross royalty on Section 17, which can be
repurchased by Energy Fuels upon payment to URI of US$5.0 million cash at any
time in the Companys sole discretion prior to the date on which the first
royalty becomes due.

On September 25, 2016, the Board of Directors of the Company
increases the size of the Board of Directors from eight to nine and appointed
Mr. Ames Brown to the Board of Directors. Mr. Brown has been the Chief
Investment Officer at Capital Counsel Mgmt LLC since 2014, and prior to that he
was a financial consultant with Wells Fargo & Co. from 2009 to 2013. Mr.
Brown holds a BA, History from Yale University and an MBA and an M.S. Strategic
Communications from Columbia University.

The Company filed a prospectus supplement (the
Supplement) on September 29, 2015 in both Canada and the United States
to its Canadian base shelf prospectus (the Canadian Base Prospectus)
and U.S. registration statement on Form F-10 (the Registration
Statement), both of which were filed on April 9, 2014. Concurrent with the
filing of the 2015 Supplement, the Company entered into a Controlled Equity
Offering Sales Agreement with Cantor Fitzgerald & Co.
(Cantor), which enabled the Company, at its discretion from
time to time, to sell, through Cantor as agent, up to US$15.64 million worth of
Common Shares by way of an at-the-market offering (the ATM). Under
the ATM, sales of the shares were authorized to occur by means of ordinary brokers
transactions or block trades, with sales only being made on the NYSE MKT at
market prices. No Common Shares were authorized to be offered or sold through the ATM on the TSX. As of the date hereof, a total of 1,476,133 Common Shares were sold under
the ATM, for net proceeds to the Company of US$3.39 million. Upon filing of this
Form 10-K, the ATM will terminate and no longer be effective.

5

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On October 2, 2015, the Company commenced a normal course
issuer bid (NCIB) to purchase for cancellation up to CDN$2.2 millionaggregate amount of its outstanding Debentures, representing approximately
10% of the CDN$22,000,000 aggregate principal amount of Debentures outstanding at
that time. The Company may purchase the Debentures at prevailing market prices
and by means of open market transactions through the facilities of the TSX. The
NCIB will remain in effect until the earlier of October 1, 2016 or the date on
which the Company has purchased the maximum number of Debentures permitted under
the NCIB. As of the date hereof, the Company has not repurchased any Debentures
under the NCIB.

On November 24, 2015, the Company entered into a definitive
agreement to sell a package of non-core uranium assets to enCore Energy Corp.
(TSX.V:UE) (enCore) and Tigris Uranium U.S. Corp., including unpatented
mining claims and leases known as the Marquez and Nose Rock properties in New
Mexico, the Moonshine property in Arizona, and the Cedar Mountain, Geitus, Blue
Jay, and Marcy Look properties in Utah. The transaction closed on January 6,
2016. Disposition of these properties is part of our continuing asset
rationalization strategy that cuts holding, permitting, and corporate costs and
allows the Company to focus on its higher quality uranium assets. The
consideration received by Energy Fuels for the sale of the properties was
$329,960 cash and 14,250,000 common shares of enCore. As a result of the
transaction, Energy Fuels owns 19.9% of the issued and outstanding shares of
enCore and holds a seat on enCores board of directors. enCore assumed all
liabilities on the properties, including all reclamation obligations.

Company Strategy

Energy Fuels intends to continue to strengthen its position as
a leading uranium extraction and recovery company focused on the United States.
With the acquisition of Uranerz, the Company has added ISR recovery to our
portfolio that, along with certain of the Companys conventional projects and
alternate feed material processing at the White Mesa Mill, sit at the lower end
of the Companys cost curve. With its large uranium resource base and existing
conventional projects on standby, under construction, and in permitting, the
Companys strategy is to remain a unique and valuable call option on increases
in the price of uranium, with significant scalability in improved market
conditions. The Company currently intends to maintain its ISR and conventional
uranium recovery capabilities, uranium resource base, and scalability. However,
continued weakness in uranium prices and cash needs dictate that the Company
engage in further measures to maintain the value of this option. As a result, at
this time we intend to conserve cash and focus on our lowest cost uranium
sources of uranium recovery, as follows:

- Continuing to systematically expand wellfield construction and uranium
  recovery at the Nichols Ranch Project on a conservative basis as market
  conditions warrant;
- Continuing the current mineral processing campaign at the White Mesa Mill
  into late 2016 to process stockpiled Pinenut Project material and alternate
  feed materials;
- Continuing shaft-sinking at the Canyon Project. In mid-2016, the Company
  expects to commence an underground drilling program to further evaluate the
  deposit;
- Following completion of the current mineral processing campaign at the
  White Mesa Mill, placing the Mill on standby and maintaining it in a state of
  readiness for the purpose of restarting mineral processing as available
  material and/or market conditions may warrant. The Company is currently
  installing five new replacement leach tanks, which are required for the 2016
  conventional processing campaign. While on standby, the White Mesa Mill will
  continue to dry and package yellowcake from the Nichols Ranch Project;
- Continuing to maintain standby projects and facilities, including the La
  Sal Project and the Daneros Project, in a state of readiness for the purpose
  of restarting mining activities, as market conditions may warrant. At this
  time, all of the Companys conventional projects, other than the Canyon
  Project, are expected to remain on standby until market conditions warrant
  restarting mining activities, or are in the evaluation or permitting process;
- Continuing ongoing business development activities, including evaluation
  and permitting of existing projects such as the Roca Honda Project, the Sheep
  Mountain Project, the Bullfrog Property at the Henry Mountains Complex, the Wate Project, and the Jane Dough Property of the Nichols Ranch Project; and
- Continuing to evaluate the sale or abandonment of non-core assets that the
  Company does not believe will add value in order to reduce costs and/or
  receive sales proceeds.

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Subsequent Events

On January 27, 2016, the Board of Directors appointed Mr. Hyung
Mun Bae as a director of the Company to fill the vacancy left by the resignation
of Mr. Joo Soo Park. Mr. Bae serves as the representative of Korea Electric
Power Corporation on the Board of Directors of the Company.

On February 2, 2016, the Company received final notice from the
U.S. Nuclear Regulatory Commission (NRC) that uranium recovery
operations involving elution, precipitation, filter press, and slurry processes
were authorized to commence at the Nichols Ranch Plant, providing the Company
with 100% self-contained ISR processing capabilities.

On February 15, 2016, the Company renegotiated the existing
non-interest bearing promissory note payable to VANE, for the 50% interest in
the Wate Project that it acquired from VANE in 2015. Originally, the note was
payable in two equal installments of $0.25 million each on the first and second
anniversaries of the note. Under the renegotiated note, the Company paid to VANE
$50,000 on or before February 13, 2015, in lieu of the first $0.25 million
payment due under the note, with the remaining $0.45 million converted to a lump
sum payment due on first commercial mineral extraction from the project.

On March 4, 2016, the Company announced that it entered into a
non-binding letter of intent (Letter of Intent) with Sumitomo to
acquire its 40% interest in the Roca Honda Project, for: (i) $1.0 million in
cash; (ii) a number of common shares of the Company equal to $1.5 million; and
(iii) once commercial mineral extraction is first commented at the Roca Honda
Project, an
additional $4.5 million of cash payable at that time. Under the Letter of
Intent, definitive agreements are expected to be entered into on or about April
1, 2016, with the closing of the transaction expected to occur on or about April
18, 2016, subject to final Sumitomo approval, and regulatory and stock exchange
approvals. The Roca Honda Project, located near Grants, New Mexico, is a uranium
project in the advanced stages of permitting. Based on a Preliminary Economic
Assessment prepared under NI 43-101 by Roscoe Postle (USA) Ltd. dated February
27, 2015, the Roca Honda Project is estimated to have a total of approximately
14.56 million pounds of uranium contained in approximately 1.51 million tons of
Measured and Indicated Mineral Resources with an average grade of 0.48%
eU3O8. In addition, the project is estimated to have a
total of approximately 11.21 million pounds of uranium contained in
approximately 1.20 million tons of Measured and Indicated Mineral Resources with
an average grade of 0.47% eU3O8. See The Roca Honda
Project under Item 2below. If this transaction closes as
contemplated, the Companys current 60% interest in the project and these
resources will increase to 100%. The Company believes that by increasing its
ownership in this project to 100% the Company will further enhance the value of
its call option on increases in the price of uranium, with significant
additional scalability in improved market conditions.

On March 7, 2016, the Company announced that it had entered
into a definitive agreement (the Mesteña Purchase Agreement) to acquire
Mesteña Uranium, LLC (Mesteña) (the Mesteña Acquisition).
Mesteña is a well-known uranium recovery company that owns the Alta Mesa
Project, located in South Texas. Mesteña engaged in uranium recovery activities
at the Alta Mesa Project from October 2005 to November 2013, during which time
the Alta Mesa Project recovered over 4.6 million pounds U3O8from six production areas. From November 2013 to the present, Mesteña has
maintained the Alta Mesa Project on standby in response to low uranium prices.
The Alta Mesa Project is located on the Jones Ranch, which is approximately
350,000 acres in size and located in Brooks and Jim Hogg Counties, Texas. The
properties included within the project include over 195,000 acres covered by a
Uranium Testing Permit and Lease Option Agreement (the Mesteña
Properties). Of that acreage, 4,575 acres is currently subject to a Uranium
Solution Mining Lease that allows current and future uranium recovery
operations. The Alta Mesa Project has a fully-licensed and constructed ISR
plant, with a design capacity of 1.5 million pounds of uranium concentrate per
year. There is an existing June 1, 2014 historical resource estimate for a
portion of the properties, prepared by Douglas L. Beahm, P.E., P.G., that is not
currently compliant with NI 43-101. This recent historical estimate shows that
the Alta Mesa Project currently contains 1.6 million tons of Measured and
Indicated Mineral Resources with an average grade of 0.11% eU3O8containing 3.6 million pounds of uranium, in addition to 7.0 million tons
of Inferred Mineral Resources with an average grade of 0.12%
eU3O8 containing 16.8 million pounds of uranium. In
addition, the historic estimate summarizes the resources currently contained in
certain exploration targets, including 2.6 million tons of material with average
grades ranging from 0.08% - 0.12% eU3O8 containing 4.1 
6.6 million pounds of uranium. Readers should be cautioned that a qualified
person has not done sufficient work to classify this estimate as a current
estimate of mineral resources or mineral reserves, and as such the Company is
not treating it as a current estimate of mineral reserves or mineral resources.
However, the Company believes the estimate is relevant and reliable, as it was
prepared within the last two years by a reputable mining consultant. In order to
upgrade and verify this historical estimate and classify it as a current mineral
resource estimate, the Company needs to perform further evaluations of the
report and confirm that its underlying assumptions continue to be reasonable and
that the report is complete and current. The Company expects to perform this evaluation and update the historical report to a NI 43-101
compliant technical report, which is expected to be filed on the System for
Electronic Document Analysis and Retrieval (SEDAR). Under the
Mesteña Purchase Agreement, the Company has agreed to issue 4,551,284 Common
Shares to the current owners of Mesteña at the closing of the transaction, which
is expected to occur on or before May 4, 2016, subject to receipt of all
applicable regulatory and stock exchange approvals and the satisfaction of
certain other conditions to closing. At closing, the Company will assume the
existing $11.0 million reclamation obligation for the project, but will acquire
the existing cash collateral backing the reclamation obligation in the amount of
approximately $4.4 million. The Mesteña properties will be subject to a royalty
equal (in total) to 3.125%of the value of the recovered U3O8 from the Mesteña properties sold at a uranium price of $65.00 or less per
pound U3O8, 6.25% of the value of the recovered
U3O8 from the Mesteña properties sold at a uranium price
greater than $65.00 and up to and including $95.00 per pound
U3O8, and 7.5% of the value of the recovered U3O8 from the
Mesteña properties sold at a uranium price greater than $95.00 per pound
U3O8. The Mesteña Purchase Agreementcontains customary
representations and warranties of the Company and customary conditions of
closing including: receipt of all required regulatory and stock exchange
approvals, including approval from the TSX, and approval from the Texas
Commission on Environmental Quality and Texas Railroad Commission relating to
the change of control of certain licenses and permits; the provision of notice
to the Committee on Foreign Investment in the United States; an amended Uranium
Solution Mining Lease covering the existing wellfields, an amended Uranium
Testing Permit and Lease Option Agreement for the entire 195,000-acres, and
amended Surface Use Agreements covering all of the 195,000-acres, as well as
other amended agreements, are entered into by all relevant parties in the forms
attached to the Mesteña Purchase Agreement or as otherwise provided for in that
agreement; the replacement by the Company of the existing surety arrangements
required under existing licenses and permits; and satisfactory completion of
certain title investigations by the Company.

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On March 14, 2016 the Company closed a public offering (the
  Offering) of Units made pursuant to an underwriting agreement dated
March 9, 2016 between the Company and a syndicate of underwriters led by Cantor
Fitzgerald Canada Corporation, as sole bookrunner, along with Haywood Securities
Inc., Roth Capital Partners, LLC, Dundee Securities Ltd., Raymond James Ltd.,
and Rodman & Renshaw, a unit of H.C. Wainwright & Co., LLC. Pursuant to
the Offering, the Company sold an aggregate of 5,031,250 Units (which includes
656,250 Units that were issued upon the exercise, in full, of the over-allotment
option that was granted to the underwriters) at a price of $2.40 per Unit for
total net proceeds of $10.88 million after commissions and estimated expenses of
the offering. Each Unit consists of one Common Share and one half of one Common
share purchase warrant, or a total of 5,031,250 Common Shares and 2,525,625
warrants. Each warrant will be exercisable until March 14, 2019, and will
entitle the holder thereof to acquire one Common Share upon exercise at an
exercise price of $3.20 per Common Share.

Uranium Sales

The Company has four (4) existing long-term contracts, which
require deliveries of 550,000 pounds of U3O8 in 2016 and
620,000 pounds of U3O8 in 2017. Two contracts expire in
2017, one contract expires in 2018, and another contract expires in 2020. Of the
1,170,000 pounds of deliveries for 2016 and 2017, a total of 570,000 pounds
of  U3O8 is required to come from the Companys
uranium recovery operations, while Energy Fuels has the option to fulfill the
remaining 600,000 pounds of U3O8 from the
Companys uranium recovery operations and/or open market purchases. At December
31, 2015, the Company has approximately 520,000 pounds of finished goods
inventory from the Companys uranium recovery operations.

The Company expects to have sufficient material available for
the 550,000 pounds of 2016 contractual deliveries, through current inventories
and expected recoveries from the White Mesa Mill and the Nichols Ranch Project.
In 2017, the Company expects to have existing inventory or uranium recovery to
meet all of its commitments to sell 620,000 pounds of uranium under its existing
long-term contracts.

The average expected realized price per pound under the
existing contracts is not subject to any decrease resulting from declines in
future U3O8 spot and/or term prices, due to the minimum
floor prices now in effect or the prices being fixed. The average sales price
under the Companys long-term contracts is expected to be higher in 2016 than
2015 levels. Selective spot sales are also expected to be made in 2016 as
necessary to generate cash for operations, construction and resource evaluation
activities, including continued shaft-sinking and evaluation at the Canyon
Project and the construction of additional wellfields at the Nichols Ranch
Project.

Segment Information

Prior to the Uranerz acquisition in June of 2015, the Company
was engaged solely in conventional uranium exploration, permitting, extraction,
and recovery. The Companys source of conventional uranium recovery is the White
Mesa Mill, which generates revenue through conventional processing, alternate
feed material processing, and toll processing agreements (the Conventional
Uranium Segment). The nature of the Companys business expanded with the
addition of ISR facilities when the Company acquired Uranerz (the ISR
Uranium Segment). Although the principal product of both segments is
uranium concentrate, or yellowcake, the methods of extraction and recovery
differ. In addition, the Conventional Uranium Segment provides services at the
White Mesa Mill, namely alternate feed material processing and toll processing,
which the Companys ISR Uranium Segment does not provide.

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Set forth below is a chart depicting the two segments of the
Companys business, together with the properties and services associated with
each segment:

ISR URANIUM SEGMENT
    CONVENTIONAL URANIUM
      SEGMENTThe ISR Uranium Segment currently includes the Nichols
      Ranch Project, which includes the Nichols Ranch Plant and surrounding
      uranium properties which are geographically situated to enable mineralized
      materials to be transported to the Nichols Ranch Plant either by pipeline
      or by truck for processing.The
      material properties included in the
      ISR Uranium Segment include:
      The Nichols Ranch Project, including
      the Nichols Ranch Plant, the Nichols
      Ranch Wellfield and the Jane
      Dough Property; and the Hank
      Project, including the permitted, but
      not constructed, Hank Satellite Plant
      and the Hank Property.
    The Conventional Uranium Segment currently includes the
      White Mesa Mill, which includes alternate feed material and toll
      processing at the Mill, and all conventional underground mineral
      extraction projects which are geographically situated to enable
      mineralized materials to be transported to the White Mesa Mill by
      truck for processing under current or reasonably anticipated future
      economic conditions.The material
      properties included in the Conventional Uranium
      Segment include: the
      White Mesa Mill, the Henry Mountains Complex, the Roca Honda Project, the
      Sheep Mountain Project (described below),
      the Canyon Project, the
      Daneros Project, and the La Sal Project.
        Non-material properties included in the Conventional Uranium Segment
          include: the Arizona 1 Project, the
          Wate Project, the possible EZ Project, the Whirlwind Project,
          the Rim Project, and the Sage
          Plain Project.
        The Company is currently
          evaluating the possible sale of the Whirlwind Project.Other ISR Propertiesincludes other ISR
      properties which are not close enough for mineralized materials to be
      transported to the Nichols Ranch plant by pipeline or truck, or that are
      currently in the evaluation stage.The Other ISR
      Properties include: The Reno Creek
      Property, the West North Butte Property, the North
      Rolling Pin Property, and the Collins
      Draw, Willow Creek, East Nichols, North
      Nichols, Verna Ann, Niles Ranch, Cedar
      Canyon, East Buck, South Collins Draw,
      Sand Rock, Little Butte, Beecher Draw,
      Lone Bull, Kermit, Monument and
      Stage  properties (each of
      which are in the
      evaluation  stage and are
      considered not material at this time).
    Other Conventional Propertiesinclude
      conventional projects which are too geographically distant for mineralized
      materials to be transported to the White Mesa Mill for processing under
      current or reasonably anticipated future economic conditions.
      The Other Conventional Properties include:
      the Sheep Mountain Project, which
      is material, and the Gas Hills and Juniper Ridge Projects, which are
        not material.
        The Gas Hills and Juniper Ridge
          Projects are currently being held for sale.


Additional segment information, including financial information
about segments, is provided in Note 20 to our financial statements under the
section heading Item 8. Financial Statements and Supplementary Data below.

Overview of Uranium Market

The primary commercial use of uranium is to fuel nuclear power
plants for the generation of electricity. All the uranium extracted from Energy
Fuels projects is expected to be used for this purpose.

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According to the Nuclear Energy Institute (NEI), in
2012 nuclear power plants provided about 11% of global electricity production.
According to the World Nuclear Association (WNA), as of March 1, 2016,
there are currently 440 operable reactors world-wide, which require
approximately 170 million pounds of U3O8 fuel per year at
full operation. Worldwide there are currently 65 new reactors under construction
with an additional 173 reactors on order, or in the planning stage and another
337 which have been proposed.

According to data from TradeTech LLC (TradeTech), the
world continues to require more uranium than it produces from primary
extraction, largely due to increasing uranium demands in Asia. The gap between
demand and primary supply has been filled by stockpiled inventories and
secondary supplies.

According to the WNA, the United States currently has 99
operating reactors, five reactors under construction, and another 42 reactors on
order, planned or proposed. According to the NEI, the United States produced
approximately 19.5% of its electricity from nuclear technology in 2014.
According to the U.S. Energy Information Agency (EIA), U.S. utilities
purchased approximately 53.3 million pounds of U3O8 in
2014. However, the U.S. onlyproduced approximately 4.9 million pounds
(9%). As a result, in 2014, the U.S. filled about 91% of its demand from foreign
sources. The EIA estimates that 2015 production is expected to drop to
approximately 3.3 million pounds.

Uranium is not traded on an open market or organized commodity
exchange such as the London Metal Exchange, although the New York Mercantile
Exchange provides financially-settled uranium futures contracts. Typically,
buyers and sellers negotiate transactions privately and directly. Spot uranium
transactions typically involve deliveries that occur immediately and up to 12
months in the future. Term uranium transactions typically involve deliveries
that occur more than 12 months in the future, with long-term transactions
involving delivery terms of at least three years. Uranium prices, both spot
prices and term prices, are published by two independent market consulting
firms, TradeTech and The Ux Consulting Company (Ux), on a weekly and
monthly basis.

The spot and term prices of uranium are influenced by a number
of global factors. For example, both the spot and term prices of uranium were
impacted by the accident at the Fukushima Daiichi Nuclear Plant in March 2011.
The events at Fukushima created heightened concerns regarding the safety of
nuclear plants and led to both temporary and permanent closures of nuclear
plants around the world. The Fukushima incident has created downward pressure on
uranium prices over the past five years, which is still being felt today.
Alternatively, China is pursuing an aggressive nuclear program, with 30 units
now operating, 24 new units under construction, 42 units which are planned, and
178 units that have been proposed, according to the WNA.

Historically, most nuclear utilities have sought to purchase a
portion of their uranium needs through long-term supply contracts, while other
portions are bought on the spot market. Like sellers, buyers seek to balance the
security of long term supply with the opportunity to take advantage of lower
prices caused by volatility in prices. For this reason, both buyers and sellers
track current spot and long-term prices for uranium carefully, make considered
projections as to future prices, and negotiate with one another on transactions
which each deems favorable to their respective interests. According to data from
Ux, levels of long-term contracting in 2013, 2014 and 2015 were well below
historical averages.

The graph below shows the monthly spot (blue line) and
long-term (red line) uranium price from August 1969 until February 2016 as
reported by TradeTech (not adjusted for inflation):

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To give a more recent perspective, the graph below shows the
monthly spot (blue line) and long-term (red line) uranium price from January
2010 until February 2016 as reported by TradeTech (not adjusted for inflation):



According to monthly price data from TradeTech, uranium prices
during 2015 were down $1.30, or 3.7% for the year. Monthly spot prices began the
year at $35.50 per pound of U3O8 and ended the year at
$34.20per pound, reaching a high of $39.40 per pound for the month of March 2015
and a low of $34.20 per pound for the month of December 2015, and dropping to
$32.15 per pound on February 29, 2016. According to Trade Tech, the spot price was  $28.75 per pound on
March 11, 2016. TradeTech price data also indicated that long-term
U3O8 prices began 2015 at $50.00 per pound and ended 2015
at $44.00 per pound, reaching a low of $44.00 per pound in August 2015, which
persisted through the end of the year. The high long-term price for 2015 was
$50.00 per pound. The Company believes the weak uranium markets are the result
of excess uranium supplies caused by large quantities of secondary uranium
extraction and excess inventories, the availability of low-priced spot material,
the delayed restart of Japanese reactors, insufficient cut-backs, premature
reactor closures, continued weak uranium demand, and general weakness in the
global economy.

Uranium Market Outlook and Uranium Marketing Strategy

World demand for clean, reliable, and affordable baseload
electricity is growing. As a result of the expected growth of nuclear energy,
the Company believes the long-term fundamentals of the uranium industry are
positive. The Company believes prices must rise to higher levels to support
the new primary production that will be required to meet the increasing demand
we expect to see as more nuclear units are constructed around the world.
According to TradeTech, world uranium requirements exceed primary mine
production, with the gap being bridged by secondary supplies and excess uranium
inventories in various forms that have already been mined. As excess inventories
are drawn down and as production from existing mines drops, the Company believes
primary mine production will be required to meet demand over the long-term.
According to data from Ux, long-term contracting levels in 2013, 2014 and 2015
have been low by historical standards. The Company believes uranium prices, and
long-term contracting levels in particular, will need to rise to levels that are
sufficient to incentivize new mine production. Even if prices rise to these
levels, it may be difficult for suppliers to respond in a timely manner, as it
typically requires many years of permitting and development to bring new mines
into production. The Company expects these permitting and development lead times
to put further pressure on prices to increase.

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Despite current market uncertainty and recently falling prices,
the Company believes it has begun to see certain early signs of a market
recovery. Japanese utilities have begun to restart their reactor fleet (Reuters,
August 11, 2015). According to data from TradeTech and the WNA, Chinese
utilities continue to aggressively build new reactors and buy uranium. According
to TradeTech, the growth of Kazakh uranium production has slowed significantly
over the past three years, and is not expected to increase significantly in the
coming years. And, in addition to China, according to the WNA, there are large
numbers of new reactors under construction and in various stages of planning
around the world.

However in the short- and medium-terms, market challenges
remain. The world continues to be oversupplied with uranium, mainly due to large
quantities of secondary and other inelastic uranium supplies (including enricher
underfeeding), high levels of excess inventories, insufficient producer
cut-backs, premature reactor shutdowns, delays in new reactor construction, two
large new mines coming into production (Cigar Lake and Husab), and decreased
demand due to Japanese reactors remaining offline for longer than expected. In
addition, there is a great deal of uncertainty in uranium prices regarding the
timing and level of the recovery, as fundamental, political, technical, and
other factors could cause prices to be significantly above or below currently
expected ranges.

Nevertheless, according to data from Ux, global utilities have
significant uncovered uranium requirements over the next 10 years, which the
Company expects will increase levels of market activity in the short- and
medium-terms.

The Companys marketing strategy is to seek a base of earnings
and cash flow through sales of a portion of its uranium into term contracts. To
gain exposure to increasing uranium prices, the Company seeks to sell a portion
of its planned uranium extraction into contracts with market-related formulas
(when available) and through future spot and term sales. Further exposure to
increasing uranium prices can be generated through the Companys ability to
bring additional uranium extraction online in the future in response to
increasing prices, which can be sold on a market-related or fixed basis at then
prevailing prices. The Companys current existing term contracts utilize
market-related formulas with base, floor and ceiling prices, some of which are
escalated at the rate of inflation. During 2015, the pricing on all of the
Companys term contracts were at their floors or at prices fixed by the
contract. Under the Companys contracts, the Company sold 1,025,000 pounds of
U3O8 at a weighted- average priceof $57.41 per
pound during 2015. The Company also sold 50,000 pounds on the spot market at a
price of $37.35 per pound. In 2016, the Company expects to sell a total of
550,000 pounds of U3O8 into its four existing contracts at
pricing expected to average approximately $58.11 based on current forecasts of
price inflation. Selective spot sales are also expected to be made in 2016 as
necessary to generate cash for operations, construction and resource evaluation
activities, including continued shaft-sinking and evaluation at the Canyon
Project and the construction of additional wellfields at the Nichols Ranch
Project.

The Vanadium Market

The White Mesa Mill has historically recovered vanadium as a
co-product of uranium from certain of its properties on the Colorado Plateau,
most notably from the La Sal Project, as well as from properties owned by
third-parties on the Colorado Plateau through toll milling and similar
arrangements, when the price of vanadium has been high enough to justify its
recovery. The Mills most recent vanadium recovery occurred in 2013 when it
recovered 1.5 million pounds of vanadium.

According to the market consultant TTP Squared, Inc.
(TTP), the vast majority of vanadium is used in the production of high
strength steels (approximately 93%). 3% is used in titanium alloys in aerospace
and other applications, and another 4% is used in catalyst and chemical
applications. Today, while only a minor quantity of vanadium is used in energy storage applications, there is
potential for greatly expanded use of vanadium in emerging battery
technologies.

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According to data from the Vanadium International Technical
Committee compiled by TTP, vanadium consumption in 2014 is estimated to have
been in excess of 92,000 metric tons. However, as the demand for high strength,
high performance steels increases, and as new uses are developed for
lightweight, high strength titanium alloys, vanadium demand can be expected to
increase at a faster rate than the growth of global steel production. The
average vanadium content in steel in developing countries is much lower than the
ratios in the developed countries and can be expected to increase, adding to the
demand. If high-capacity batteries using vanadium are commercialized, demand can
be expected to increase further. The Company believes the future prospects for
vanadium are highly dependent on continued growth in China.

While demand is expected to grow over time, supply likely has
the capacity to increase to meet this demand. Most vanadium is recovered as a
byproduct or coproduct of other processes. Many primary producers, in countries
such as China, Russia and South Africa, have been shut down due to low prices.
Extraction of vanadium from steel making slag has been cut back or halted. As
demand increases and prices strengthen, some of these facilities can be expected
to restart or increase production, thus moderating any anticipated price
increases.

Vanadium (as V2O5) prices were down for
2015, beginning the year at $5.03 per pound, and ending the year at $2.38 per
pound. Vanadium prices are currently at $2.85 per pound.

While long-term demand for vanadium can be expected to
increase, it is unknown whether future prices for vanadium will increase due to
the relatively high number of low-cost suppliers who may re-enter the market as
prices increase.

Vanadium Marketing

In the past, Energy Fuels has sold its vanadium both as
V2O5 and as ferrovanadium (FeV) through spot
sales to industry end-users and trading companies. No vanadium was recovered or
sold by the Company during 2015, and none is expected to be recovered or sold
until uranium and/or vanadium prices improve.

Competition

The uranium industry is highly competitive. The Company
competes with mining and exploration companies for uranium sales, the
acquisition of uranium mineral properties, and the procurement of equipment,
materials and personnel necessary to explore, develop, and extract uranium from
such properties. There is competition for a limited number of uranium
acquisition opportunities, including competition with other companies having
substantially greater financial resources, staff and facilities than the
Company. As a result, the Company may encounter challenges in acquiring
attractive properties, and exploring and advancing properties currently in the
Companys portfolio. In addition, Energy Fuels competes with other uranium
recovery companies, along with traders, brokers, financial institutions,
converters, enrichers, and other market actors, for uranium sales. Due to the
Companys limited capital and personnel and the relative size of its operations,
the Company may be at a competitive disadvantage compared to some other
companies with regard to exploration and, if warranted, development of mining
properties and securing uranium sales. The Company believes that competition for
acquiring mineral prospects and completing uranium sales will continue to be
intense in the future.

The availability of funds for exploration, evaluation,
permitting and construction of uranium projects is limited, and the Company may
find it difficult to compete with larger and more established uranium
exploration and production companies for capital. The Companys inability to
continue exploration, advancement, and the acquisition of new properties due to
lack of funding could have a material adverse effect on the Companys future
operations and financial position.

Government Regulation

The Companys properties and facilities are subject to
extensive laws and regulations which are overseen and enforced by multiple
federal, state and local authorities. These laws govern exploration,
construction, extraction, recovery, processing, exports, various taxes, labor
standards, occupational health and safety, waste disposal, protection and
remediation of the environment, protection of endangered and protected species,
toxic and hazardous substances, and other matters. Uranium minerals exploration,
extraction, recovery, and processing are also subject to risks and liabilities associated with pollution of the
environment and disposal of waste products occurring as a result of such
activities.

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Compliance with these laws and regulations may impose
substantial costs on the Company and will subject the Company to significant
potential liabilities. Changes in these regulations could require the Company to
expend significant resources to comply with new laws or regulations or changes
to current requirements and could have a material adverse effect on the
Companys business operations.

Environmental Regulations

Exploration, development, and extraction activities are subject
to certain environmental regulations which may prevent or delay the continuance
of our activities. In general, our exploration, evaluation, and extraction
activities are subject to certain federal and state laws and regulations
relating to environmental quality and pollution control. Such laws and
regulations increase the costs of these activities and may prevent or delay the
commencement or continuance of a given operation. Specifically, we are subject
to legislation regarding emissions into the environment, water discharges, and
storage and disposition of hazardous wastes. In addition, legislation has been
enacted which requires facility sites to be abandoned and reclaimed in
accordance with such legislation. Compliance with these laws and regulations has
not had a material effect on our operations or financial condition to date.

Uranium milling in the U.S. is primarily regulated by the
United States Nuclear Regulatory Commission (the NRC) pursuant to the
Atomic Energy Act of 1954, as amended. Its primary function is to ensure
the protection of employees, the public, and the environment from radioactive
materials, and it also regulates most aspects of the uranium recovery process.
The NRC regulations pertaining to uranium recovery facilities are codified in
Title 10 of the Code of Federal Regulations.

On August 16, 2004, the State of Utah became an Agreement State
for the regulation of uranium mills. This means that the primary regulator for
the White Mesa Mill is now the State of Utah Department of Environmental Quality
(UDEQ) rather than the NRC. At that time, the Mills NRC Source
Material License was transferred to the State of Utah and became a Radioactive
Materials License. The State of Utah incorporates, through its own regulations
or by reference, all aspects of Title 10 pertaining to uranium recovery
facilities. When the State of Utah became an Agreement State, it required that a
Groundwater Discharge Permit (GWDP) be put in place for the White Mesa
Mill. The GWDP is required for all similar facilities in the State of Utah, and
specifically tailors the implementation of the state groundwater regulations to
the Mill site. The State of Utah requires that every operating uranium mill have
a GWDP, regardless of whether or not the facility discharges to groundwater. The
GWDP for the Mill was finalized and implemented in March 2005. The White Mesa
Mill also maintains a permit approval for air emissions with the UDEQ, Division
of Air Quality.

Conventional uranium extraction is subject to regulation by a
number of agencies including (1) local county and municipal government agencies;
(2) the applicable state divisions responsible for mining and protecting the
environment within Utah, Colorado, Arizona, New Mexico, and Wyoming; (3) the BLM
and the United States Forest Service (the USFS) on public lands under
their jurisdiction; (4) the U.S. Mine Safety and Health Administration
(MSHA); (5) the United States Environmental Protection Agency (the
EPA) for radon emissions from underground mines; and (6) other federal
agencies (e.g., U.S. Fish and Wildlife Service, U.S. Army Corp. of Engineers,
DOE), where certain conditions exist. In addition, a uranium processing facility
at the Sheep Mountain Project will be subject to regulation under the NRC, as a
uranium processing facility and for permanent disposal of the resulting
tailings.

The provisions of the Atomic Energy Act and its regulations
that are applicable to uranium milling also apply to our ISR facilities in
Wyoming. The Nichols Ranch Project has a Source Material licensed issued by the
NRC. ISR facilities in Wyoming are also regulated by the State of
Wyoming and the EPA under the Clean Water Act, the Clean Air Act and the
Resource Conservation and Recovery Act. In addition, ISR wellfields require an
Underground Injection Control Permit under the Safe Drinking Water Act, as
administered by the EPA. ISR operations, such as the Nichols Ranch Project, are
subject to regulations by the U.S. Occupational, Safety and Health
Administration (OSHA), rather than MSHA.

Reclamation bonds or the equivalent have been posted for each
of the Companys material properties that have structures or facilities.

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Energy Fuels is required to have export licenses issued by the
NRC for its uranium exports. Such licenses are obtained by the Company as
required.

Land Tenure

The Companys land holdings are held either by leases from the
fee simple owners (private parties or the State) or unpatented mining claims
located on property owned and managed by the U.S. Federal Government. Annual
fees must be paid to maintain unpatented mining claims, but work expenditures
are not required. Holders of unpatented mining claims are generally granted
surface access to conduct mineral exploration and extraction activities.
However, additional permits and plans are generally required prior to conducting
exploration or mining activities on such claims.

On July 9, 2009, BLM issued a Notice of Proposed Withdrawal
(2009 Notice) under which it proposed that a total of approximately one
million acres of public lands around the Grand Canyon National Park be withdrawn
from location and entry under the Mining Law of 1872 (the Mining Law),
subject to valid existing rights. In the 2009 Notice, BLM stated that the
purpose of the withdrawal, if determined to be appropriate, would be to protect
the Grand Canyon watershed from any adverse effects of locatable hardrock
mineral exploration and mining. The 2009 Notice segregated the lands from
location and entry under the mining laws for up to two years to allow time for
various studies and analyses, including appropriate NEPA analysis. In order to
allow more time for BLM to complete its NEPA analysis, the U.S. Department of
the Interior (the DOI) published Public Land Order 7773 on June 21,
2011, which affected a six-month emergency withdrawal of the area. The emergency
withdrawal prevented the lands from opening to location and entry under the
Mining Law upon expiration of the two-year segregation while the DOI completed
the decisionmaking process on the proposed withdrawal. The emergency withdrawal
was effective July 21, 2011 to January 20, 2012. During the two-year segregation
and six month emergency withdrawal, the BLM, along with its cooperating
agencies, completed various studies and analyses of resources in the withdrawal
area, including an EIS under NEPA. These studies and analyses were undertaken to
provide the basis for the final decision regarding whether or not to proceed
with the proposed withdrawal or to select an alternative action. Based on this
analysis, on January 9, 2012, the DOI announced its final decision to withdraw
from location and entry under the Mining Law, subject to valid existing rights,
the total of approximately one million acres of lands originally proposed in the
2009 Notice (the Withdrawn Lands), for a 20-year period. Lawsuits
challenging this decision have been filed by various industry groups and
interested parties.

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 the discovery of a valuable mineral deposit.

All of the Companys properties located on the Arizona Strip,
with the exception of its Wate property and certain exploration properties held
by the Companys subsidiary, Arizona Strip Partners LLC, are located within the
Withdrawn Lands. A mineral examination on the Companys EZ Project will need to
be completed by BLM, in conjunction with its review of the Companys proposed
Plan of Operations for that project. Mineral examinations were not required for
the Companys Arizona 1 and Pinenut projects, which had previously approved
Plans of Operations and were recently active. Although the Companys Canyon
Project also has an approved Plan of Operation, and a mineral examination is not
required, the USFS performed a mineral examination on that project in 2012 and
concluded that the Canyon Projects claims constitute valid existing rights. The
USFS also concluded that no additional approvals are required on the Canyon
Project.

The Company believes that all of its material projects within
the Withdrawn Lands are on valid mining claims that will each withstand a
mineral examination. However, market conditions may postpone or prevent the
performance of mineral examinations on certain 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 of more of the Companys mining
claims being considered invalid, which could prevent a project from
proceeding.

In addition, there are efforts underway that have the potential
to create a National Monument on the Withdrawn Lands, and additional lands, near
the Grand Canyon National Park. These efforts include proposed legislation which has been
introduced in Congress and lobbying of the President of the United States to
create a National Monument utilizing his executive powers under the Antiquities
Act of 1906. All of the Companys projects, except the Wate Project, are located on lands which have the potential to be included in a
National Monument. If such a National Monument is created, there is the
potential that these projects could become subject to additional requirements and/or
costs, or be prevented from proceeding.

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Employees

Currently, the Company and its subsidiaries have approximately
189 full-time employees and 5 full-time consultants. We operate in established
mining areas where we have found sufficient available personnel for our business
plans.

Available Information

Detailed information about us is or will be contained in our annual reports
on Form 10-K, annual reports on Form 40-F, current reports on Form 8-K, current
reports on Form 6-K, proxy statements and other reports, and amendments to those
reports, that we file with or furnish to the SEC. Prior to January 1, 2016, we
were a foreign private issuer subject to limited periodic disclosure and current
reporting requirements of the United States Securities Exchange Act of 1934, as
amended (the Exchange Act), so we did not previously file Forms 10-K or
10-Q. On a going-forward basis, these reports are available free of charge on
our website, www.energyfuels.com, as soon as reasonably practicable after we
electronically file such reports with or furnish such reports to the SEC.
However, our website and any contents thereof should not be considered to be
incorporated by reference into this document. We will furnish copies of such
reports free of charge upon written request to our Investor Relations
department. You can contact our Investor Relations department at:

Energy Fuels Inc. 225 Union Blvd., Suite 600 Lakewood,
Colorado, 80228 Tel: 303.974.2140 Fax: 303.974.2141 Toll Free:
1.888.864.2125 E-mail: investorinfo@energyfuels.com

Additionally, our Code of Ethics, Audit Committee Charter, and
certain Company policies are available on our website. We will furnish copies of
such information free of charge upon written request to our Investor Relations
department.

ITEM 1A. RISK FACTORS

Our failure to successfully address the risks and uncertainties
described below would have a material adverse effect on our business, financial
condition and/or results of operations, and the trading price of our common
shares may fluctuate widely. We cannot assure you that we will successfully
address these risks or other unknown risks that may affect our business.

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 Energy Fuels. Other factors may arise in the future
that are currently not foreseen by management of Energy Fuels that may present
additional risks in the future. Current and prospective security holders of
Energy Fuels should carefully consider these risk factors.

We are subject to the risks normally encountered by
Companies in the mineral extraction industry.

We are subject to the risks normally encountered by companies in
the mineral extraction industry, such as:

- the discovery of unusual, or unexpected geological formations;
- accidental fires, floods, earthquakes, volcanic eruptions, and other
  natural disasters;
- unplanned power outages and water shortages;
- controlling water and other similar mining hazards;
- operating labor disruptions and labor disputes;
- the ability to obtain suitable or adequate machinery, equipment, or labor;
- our liability for pollution or other hazards; and

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- other known and unknown risks involved in the conduct of exploration,
  development, and operation of mines, extraction and recovery facilities, and
  mills, along with the market for uranium.

The development of mineral properties is affected by many
factors, including, but not limited to: the cost of operations; variations in
the grade of mineralized material; fluctuations in metal markets; costs of
extraction and processing equipment; availability of equipment and labor; labor
costs and possible labor strikes; government regulations, including without
limitation, regulations relating to taxes, royalties, allowable extraction or
production, importing and exporting of minerals; foreign exchange; employment;
worker safety; transportation; and environmental protection.

Our results of operations are significantly affected by
the market price of uranium and vanadium which are cyclical and subject to
substantial price fluctuations.

Our earnings and operating cash flow are and will be
particularly sensitive to the long and short term changes in the market price of
uranium and vanadium. Among other factors, these prices also affect the value of
our resources, reserves, and inventories, as well as the market price of our
Common Shares.

Market prices are affected by numerous factors beyond our
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; the premature
decommissioning of nuclear power plants; 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; the
potential for vanadium to be used in advanced battery technologies; political
and economic conditions in vanadium producing and consuming countries; world
production levels; and costs of production. Other factors relating to both the
price of uranium and vanadium include: levels of supply and demand for a broad
range of industrial products; substitution of new or different products in
critical applications for our 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; regional and global economic conditions; and sales of uranium and
vanadium by holders in response to such factors. If prices are below our cash
costs of extraction or recovery and remain at such levels for any sustained
period, we may determine that it is not economically feasible to continue
commercial extraction or recovery at any or all of our projects or other
facilities and may also be required to look for alternatives other than cash
flow to maintain our liquidity until prices recover. Our expected levels of
uranium recovery and business activity are dependent on our expectation and the
industrys expectations of uranium and vanadium prices, which may not be
realized or may change. In the event we conclude that a significant
deterioration in expected future uranium prices has occurred, we will assess
whether an impairment allowance is necessary which, if required, could be
material.

The recent fluctuations in the price of many commodities is an
example of a situation over which we have no control and which could materially
adversely affect us in a manner for which we may not be able to compensate.
There can be no assurance that the price of any minerals recovered from our
properties will be such that any deposits can be operated at a profit.

Our profitability is directly related to the market price of
uranium and vanadium recovered. We 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. We
anticipate selling forward in the ordinary course of business if, and when, we
have sufficient assets and recovery to support forward sale arrangements. There
are, however, risks associated with forward sale programs. If we do not have
sufficient recovered uranium to meet our forward sale commitments, we may have
to buy or borrow (for later delivery back from recovered uranium) sufficient
uranium in the spot market to deliver under the forward sales contracts,
possibly at higher prices than provided for in the forward sales contracts, or
potentially default on such deliveries. In addition, under forward contracts, we
may be forced to sell at prices that are lower than the prices that may be
available on the spot market when such deliveries are completed. Although we may
employ various pricing mechanisms within our sales contracts to manage our
exposure to price fluctuations, there can be no assurance that such mechanisms
will be successful.

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Our properties do not contain mineral reserves under SEC
Industry Guide 7, and a number of the Companys properties, projects, and facilities
are not economic at todays commodity prices.

Our properties do not contain any mineral reserves under SEC
Industry Guide 7. See Cautionary Note to United States Investors Concerning
Disclosure of Mineral Reserve and Mineral Resource Estimates above. At
current uranium and vanadium prices, a number of our properties, projects, and
facilities are not economic for uranium, and for some properties uranium and/or
vanadium, extraction, recovery, or processing. We intend to continue to hold,
and in certain cases advance, a number of those properties, projects, and
facilities in anticipation of possible future increases in the prices of uranium
and/or vanadium, as the case may be. However, there can be no assurance that
uranium and/or vanadium prices will ever, or within a reasonable time period,
increase to the levels required to advance those properties or, in the case of
projects or facilities on standby, to resume exploration, extraction, recovery,
or processing activities at those projects or facilities. We continue to hold
such properties, projects, and facilities because we believe that uranium and/or
vanadium prices are likely to rise to such levels within a reasonable time
period, and the ability to maintain scalability as commodity prices increase is
a key component of our business strategy. However, as there is a cost associated
with holding and in some cases maintaining on standby such properties, projects,
or facilities, we continuously evaluate, on a case-by-case basis, such costs
against the prospects for price increases, and may from time to time sell, drop
or reclaim any such properties, projects, or facilities. We have currently
identified a number of non-core properties and projects that we intend to sell,
drop, or reclaim given current market conditions.

The White Mesa Mill has historically been run on a
campaign basis as sufficient feed materials are available, and there can be no
assurance that sufficient mill feed will be available in the future to sustain
future campaigns.

The White Mesa Mill has historically operated on a campaign
basis, whereby mineral processing occurs as mill feed, cash needs, contract
requirements, and/or market conditions may warrant. Once the processing for 2016
concludes (expected to be in late 2016), the Company expects to place mineral
processing activities at the Mill on standby until additional mill feed becomes
available, which may not occur for several years. The Mill is expected to
continue to dry and package material from the Nichols Ranch Project and continue
to receive and stockpile alternate feed materials for future milling campaigns.
Each future milling campaign will be subject to receipt of sufficient mill feed
that would allow us to operate the Mill on a profitable basis and/or recover a
portion of its standby costs.

At current uranium and vanadium prices, all of our conventional
properties are on standby, other than shaft-sinking and evaluation activities at
our Canyon Project and evaluation and permitting activities at our other
properties, and no third party conventional properties are operating to provide
mill feed. There can be no assurance that sufficient mill feed will be available
in the future that would allow us to operate the White Mesa Mill on a profitable
basis and/or recover a portion of its standby costs at any time.

We have entered into term sales contracts for a portion
of our recovered uranium, and there can be no guarantee that we will be able to
extend the terms of those contracts or enter into new term sales contracts in
the future on suitable terms and conditions.

Those contracts, which have historically resulted in uranium
sales at prices in excess of spot prices, have fixed delivery terms. Certain of
our contracts have delivery terms that have expired with no future deliveries
planned. The failure to renew existing term sales contracts, or enter into new
term sales contracts on suitable terms, could adversely impact our operations
and mining activity decisions, and resulting cash flows and income.

We are subject to global economic risks.

In the event of a general economic downturn or a recession,
there can be no assurance that our business, financial condition, and results of
operations would not be materially adversely affected. During the past several
years, the global economy faced a number of challenges. During the global
financial crisis of 2007-8 economic problems in the United States and Eurozone
caused deterioration in the global economy, as numerous commercial and financial
enterprises either went into bankruptcy or creditor protection or had to be
rescued by governmental authorities. Access to public financing was 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, and massive investment losses by banks with resultant
recapitalization efforts. Although economic conditions have shown improvement in
recent years, the global recovery from the recession has been slow and has
possibly shown recent signs of possible deterioration. These factors continue to
impact commodity prices, including uranium and vanadium, as well as currencies
and global debt and stock markets.

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These factors may impact our ability to obtain equity, debt, or
other financing on terms commercially reasonable to us, 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 if there is a material deterioration in general business and
economic conditions, our operations could be adversely impacted and the trading
price of our securities could be adversely affected.

The price of our Common Shares is subject to volatility.

Securities of mining companies have experienced substantial
volatility and downward pressure in the recent 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 our 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 including oil and natural gas,
currency exchange fluctuation, or in our financial condition or results of
operations as reflected in our periodic earnings reports. Other factors
unrelated to our performance that may have an effect on the price of our
securities include the following: the extent of research coverage available to
investors concerning our business may be limited if investment banks with
research capabilities do not follow our securities; lessening in trading volume
and general market interest in our securities may affect an investor's ability
to trade significant numbers of our securities; the size of our public float and
the exclusion from market indices may limit the ability of some institutions to
invest in our securities; and a substantial decline in the price of our
securities that persists for a significant period of time could cause our
securities to be delisted from an exchange, further reducing market liquidity.
Our exclusion from certain market indices may reduce market liquidity or the
price of our securities. If an active market for our securities does not
continue, the liquidity of an investor's investment may be limited and the price
of our securities may decline. If an active market does not exist, investors may
lose their entire investment. As a result of any of these factors, the market
price of our securities at any given point in time may not accurately reflect
our long-term value. Securities class-action litigation often has been brought
against companies in periods of volatility in the market price of their
securities, and following major corporate transactions or mergers and
acquisitions. We 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.

Exploration, development, extraction, mining, recovery
and milling of minerals, and the transportation and handling of the products
recovered, are subject to extensive federal, state and local laws and
regulations.

These regulations govern, among other things; acquisition of
the property or mineral interests; maintenance of claims; tenure; expropriation;
prospecting; exploration; development; construction; extraction and mining;
recovery, processing, 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, mill and
other facility 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 of our mines, mills, plants and other
extraction, recovery and processing facilities. It is possible that, in the
future, the costs, delays and other effects associated with such laws and
regulations may impact our decision as to whether to operate existing mines or
facilities, or, with respect to exploration, development or construction
properties, whether to proceed with exploration, development or construction, or
that such laws and regulations may result in our incurring significant costs to
remediate or decommission properties that do not comply with applicable
environmental standards at such time. We expend significant financial and
managerial resources to comply with such laws and regulations. We anticipate
continuing 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 our activities, operations or
financial condition. 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 us, increase costs, cause a reduction in levels of, or
suspension of, extraction or recovery and/or delay or prevent the construction
or development of new mineral extraction properties.

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Mineral extraction 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, extraction, mining,
recovery and production. Environmental liability may result from mining or
mineral extraction activities conducted by others prior to our 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 activities or
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 we be unable to fully fund the cost of remedying an
environmental problem, the Company might be required to suspend activities or
operations, declare bankruptcy, 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 we are subject to uninsured
environmental liabilities, the payment of such liabilities would reduce
otherwise available earnings and could have a material adverse effect on us. In
addition, we do 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 and facility, construction,
development and operating costs

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 mineral
properties 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 of our control. Any
significant delays in obtaining or renewing such permits or licenses in the
future could have a material adverse effect on us. 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 our business.

Public acceptance of nuclear energy and competition from
other energy sources is unknown.

Growth of the uranium and nuclear industry will depend upon
continued and increased acceptance of nuclear technology as an economic 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, hydro-electricity and
renewable energy sources. 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. Increased government regulation and
technical requirements may make nuclear uneconomic, resulting in lower demand
for uranium concentrates. Technical advancements and government subsidies 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.

The uranium industry is highly competitive, and it
competes with other energy sources.

The international uranium industry, including the supply of
uranium concentrates, is competitive. We market uranium in direct competition
with supplies available from a relatively small number of uranium mining
companies, from nationalized uranium companies, from uranium produced as a
byproduct of other mining operations, 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. A large
quantity of current World production is inelastic, in that uranium market prices
have little effect on the quantity supplied. 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 our control and may affect the supply of uranium
available in the United States and Europe.

We compete with other mining companies and individuals for
capital, mineral resources and reserves, and other mining assets, which may
increase the cost of acquiring suitable claims, properties and assets, and we
also compete with other mining companies to attract and retain key executives,
employees and consultants. In addition, there are relatively few customers for
uranium. There can be no assurance that we will continue to be able to compete
successfully with our competitors in acquiring such properties and assets or in
attracting and retaining skilled and experienced employees.

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We may be unable to timely pay our outstanding debt
obligations, which may result in us losing some of our assets covered by
mortgage and/or other security arrangements and may adversely affect our assets,
results of operations, and future prospects.

We may from time to time enter into arrangements to borrow
money in order to fund our operations and expansion plans, and such arrangements
may include covenants that restrict our business in some way. We may also from
time to time acquire properties whereby certain payment obligations owed to the
seller are paid by us over time, with the sellers sole remedy for non-payment
by us being reacquisition of the property. Events may occur in the future,
including events out of our control that would cause us to fail to satisfy our
obligations under our existing convertible Debentures and/or other debt or
financing instruments. In such circumstances, or if we were to default on our
obligations under the debt or financing instruments, the amounts drawn under our
agreements may become due and payable before the agreed maturity date, and we
may not have the financial resources to repay such amounts when due.

On November 26, 2013, our subsidiary, Uranerz entered into a
Financing Agreement (the Financing Agreement) with Johnson County,
Wyoming (the County) pursuant to which the County agreed to loan to
Uranerz (the Loan) the proceeds from the sale of its $20,000,000
Taxable Industrial Development Revenue Bond, Series 2013, (the Bond)
upon the terms and conditions set out in the Financing Agreement, for the
purpose of financing the Nichols Ranch project. On November 26, 2013, in
connection with the Financing Agreement and the Loan, Uranerz as mortgagor
entered into a Mortgage & Security Agreement, pursuant to which Uranerz
granted to the Trustee its rights and interests in the as-extracted collateral,
contract rights relating directly or indirectly to the Lands (as identified in
Exhibit A to the Mortgage & Security Agreement), general intangibles
relating directly or indirectly to the Lands, fixtures or hereinafter located on
the Lands or the Nichols Ranch ISR Plant, goods (including all
inventory) and equipment, including without limitations the mineralized material
and all personal property identified as owned by Uranerz in the Mortgage &
Security Agreement to secure Uranerz obligations under the Financing Agreement,
the Bond Purchase Agreement and the Note. The Mortgage & Security Agreement
contains restrictive covenants, including, without limitation, that obligate
Uranerz not to: (i) sell, convey, mortgage, pledge or otherwise dispose of or
encumber the Encumbered Property (as set forth in the Mortgage and Security
Agreement) without first securing the written consent of the mortgagee; (ii)
cancel or terminate any Post Production Contracts (as set forth in the Mortgage
and Security Agreement) or consent to or accept any cancellation or termination
thereof; (iii) amend or otherwise modify any Post Production Contracts or give
any consent, waiver or approval thereunder; (iv) waive any default under or
breach of any Post Production Contracts; or (v) take any other action in
connection with the Post Production Contract which would impair the value of the
interest or rights of Uranerz thereunder or which would impair the interests or
rights of the mortgagee.

If Uranerz is unable to timely satisfy its obligations under
the Loan, including timely payment of the interest when due and payment of the
principal amount at maturity and Uranerz is not able to successfully extend the
maturity date or otherwise re-negotiate the terms of the Note, the Trustee will
have rights under the Mortgage and Security Agreement to potentially seize or
sell the secured properties and interests, equipment and personal property and
the Nichols Ranch Plant to satisfy Uranerz obligations under the
Loan. Any failure to timely meet Uranerz obligations under the Loan may
adversely affect our assets, results of operations and future prospects.

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

Our Convertible Debentures will mature in 2017 and will
be retired through either cash payment or the issuance of Common Shares.

On July 24, 2012, the Company issued Cdn$22,000,000 aggregate
principal amount of convertible debentures (the Debentures). The
Debentures will mature on June 30, 2017 and are convertible into Common Shares
of the Company at the option of the holder at a conversion price, subject to
certain adjustments, of Cdn$15.00 per share at any time prior to redemption or
maturity. The Debentures may be retired at maturity either through the payment
of cash or the issuance of Company shares, at the Companys option. This will
either result in the allocation of cash to the retirement of the Debentures, which could be used for other
purposes, or the issuance of Common Shares, which would result in dilution to
shareholders.

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We may need additional financing in connection with the
implementation of our business and strategic plans from time to
time.

The exploration, construction and development of mineral
properties and the ongoing operation of mines and other facilities requires a
substantial amount of capital and may depend on our ability to obtain financing
through joint ventures, debt financing, equity financing or other means. We may
accordingly need further capital in order to take advantage of further
opportunities or acquisitions. Our financial condition, general market
conditions, volatile uranium and vanadium markets, volatile interest rates,
legal claims against us, a significant disruption to our 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. Further, continuing volatility in the credit markets may increase
costs associated with debt instruments due to increased spreads over relevant
interest rate benchmarks, or may affect our ability, or the ability of third parties we seek to
do business with, to access those markets. Continued volatility in equity
markets, specifically including energy and commodity markets, may increase the
costs associated with equity financings due to a low share price, and the
potential need to offer higher discounts and other value (e.g., warrants). There
is no assurance that we will be successful in obtaining required financing as
and when needed on acceptable terms, if at all.

As a result of the loss of our foreign private issuer
status, we are now required to comply with the Exchange Acts domestic reporting
regime, which may cause us to incur additional legal, accounting, and other
expenses.

As of June 30, 2015 we determined that we no longer qualify as
a foreign private issuer as such term is defined in Rule 405 under the United
States Securities Act of 1933, as amended (the Securities Act). This
means we are now required to comply with all of the periodic disclosure and
current reporting requirements of the Exchange Act applicable to U.S. domestic
issuers, such as Forms 10-K, 10-Q and 8-K, rather than the forms we have filed
with the SEC in the past as a foreign private issuer, such as Forms 40-F and
6-K. We are accordingly required to prepare our financial statements filed with
the SEC in accordance with generally accepted accounting principles in the
United States (US GAAP) (and must recast prior financial statements and
selected financial data from the International Financial Reporting Standards
(IFRS) into US GAAP for all periods required to be presented in the
financial statements). As of January 1, 2016 we have also been required to
comply with the provisions of U.S. securities laws applicable to U.S. domestic
issuers including, without limitation, the U.S. proxy rules, Regulation FD, and
the Section 16 beneficial ownership reporting and short swing profit rules. We
have modified certain of our policies to comply with good governance practices
associated with U.S. domestic issuers. In addition, we have lost our ability to
rely upon exemptions from certain corporate governance requirements on the NYSE
MKT that are available to foreign private issuers.

As a result of such compliance with these additional securities
laws, including the transition from IFRS to US GAAP, as well as NYSE MKT rules
applicable to U.S. domestic issuers, the regulatory and compliance costs to us
under U.S. securities laws may be significantly higher than the cost we would
incur as a foreign private issuer. We therefore expect that the loss of foreign
private issuer status will increase our legal and financial compliance costs and
make some activities highly time-consuming and costly, and that the costs
associated with compliance will increase further once we are no longer an
emerging growth company.

The issuance of additional Common Shares may impact the
trading price of our common shares.

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

Mining operations involve a high degree of risk.

The exploration, construction, development, operation, and
other activities associated with mineral projects, along with the expansion of
existing recovery operations and mining activities and restarting of projects,
involve significant risks, including financial, technical, and regulatory risk.
Development or advancement of any of the exploration properties in which we have
an interest will only follow upon obtaining satisfactory exploration results,
project permitting and licensing, and financing. The exploration, construction,
development, operation and other activities associated with mineral projects
involves 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 or other facility may
result in substantial rewards, few properties which are explored are ultimately
developed into producing mines or extraction or recovery facilities. Major
expenses may be required to establish mineral resources and mineral reserves by
drilling and to finance, permit, license, and construct extraction, mining,
recovery and processing facilities. It is impossible to ensure that the current
or proposed exploration, permitting, construction, or development programs on
our mineral properties will result in a profitable commercial extraction,
mining, or recovery operations.

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

It is possible that actual costs and economic returns of
current and new extraction, mining, or recovery operations may differ materially
from our best estimates. It is not unusual in the mining industry for new mining
operations and facilities to experience unexpected problems during the start-up
phase, take much longer than originally anticipated to bring into a recovery or
producing phase, require more capital than anticipated, operate at a higher cost
than expected, and/or have reclamation liabilities which are higher than
expected.

There is uncertainty in the estimation of mineral
reserves and mineral resources.

Our properties do not contain any mineral reserves under
Industry Guide 7. See Cautionary Note to United States Investors Concerning
Disclosure of Mineral Reserve and Mineral Resource Estimates above.

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. Our
mineral reserves and resources are estimates, and no assurance can be given that
the estimated reserves and resources are accurate or that the indicated level of
uranium or vanadium will be produced economically or otherwise. 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 extraction, production or recovery 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 and reserve estimates may require revision as more drilling
information becomes available or as actual extraction, production or recovery
experience is gained. It should not be assumed that all or any part of our
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 our 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.

Our business is subject to extensive environmental
regulations that may make exploring, mining, or related activities expensive,
and which may change at any time.

We are required to comply with environmental protection laws
and regulations and permitting requirements promulgated by federal agencies and
various states and counties in which we operate and conduct our activities, in
connection with extraction, mining, recovery and milling operations. The uranium
industry is subject not only to the worker health and safety and environmental
risks associated with all mining activities, but also to additional risks
uniquely associated with uranium extraction, mining, recovery, and milling. We
expend 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 extraction, mining,
recovery or milling, the disposition of wastes, the decommissioning and
reclamation of exploration, extraction, mining, recovery, 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.

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We 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
and other facility 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 our results of operations and
business or may cause material changes or delays in our intended activities.
There can be no assurance of our 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 uranium extraction levels.

Our 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. We cannot provide assurance that we will be able to obtain or
maintain all necessary permits that may be required to continue operations or
exploration and development of our properties or, if feasible, to commence
construction, development, operation or other activities relating to mining
facilities at such properties on terms that enable operations or activities to
be conducted at economically justifiable costs. If we are unable to obtain or
maintain, licenses, permits or other rights for construction or development of
our properties, or otherwise fail to manage adequately future environmental
issues, our uranium recovery operations and mining activities could be
materially and adversely affected.

On December 31, 2014, the EPA issued a proposed rule that would
amend 10 CFR §192, Health and Environmental Protection Standards for Uranium
and Thorium Mill Tailings, to add standards and regulation for ISR
facilities such as the Nichols Ranch Project. The effect of the proposed rule,
as written, is expected to be significant if promulgated. The proposed rule
would require additional background and baseline work for new in-situ uranium
recovery wellfields and for active and future wellfields, it would also add
more stringent groundwater restoration requirements, additional requirements for
alternate concentration limits, and a 30-year post-restoration monitoring
period. Currently, the proposed rule has received extensive comments from other
federal agencies, States with primacy authority, mining and nuclear trade
organizations, and the domestic uranium industry, all of which are being
considered by EPA, and could result in changes to the proposed rules. No action
is expected from EPA until after the end of 2016. If this proposed rule is
promulgated in its current form, it would be expected to impose significant
costs and project risks such that any in-situ uranium recovery project,
including the Nichols Ranch Project, could become unviable. Any changes to rules
or regulations that could significantly adversely impact any of our material
projects could have a material adverse impact on the Company.

In addition, there are efforts underway that have the potential
to create a National Monument on the Withdrawn Lands, and additional lands, near
the Grand Canyon National Park. These efforts include legislation which has been
introduced in Congress and lobbying of the President of the United States to
create a National Monument utilizing his executive powers under the Antiquities
Act of 1906. All of the Companys projects located on the Arizona Strip are
located on lands which have the potential to be affected by a National Monument.
A National Monument created on land where our projects are sited, or is near the
Companys projects, along with any resulting changes to rules or regulations,
could significantly adversely impact any of our material projects and could have
a material adverse impact on the Company.

Opposition to mining may disrupt our business
activities.

In recent years, governmental agencies, non-governmental
organizations, individuals, communities and courts have become more vocal and
active with respect to their opposition to certain mining and business
activities including with respect to production and uranium recovery at our
facilities, such as the White Mesa Mill and the Canyon Project. This opposition
may take on forms such as road blockades, applications for injunctions seeking
to cease certain construction, development, extraction, mining and/or milling or
recovery activities, 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 our interests.
These actions can occur in response to current activities or in respect of mines
or facilities that are decades old. In addition, these actions can occur in
response to our activities or the activities of other unrelated entities.
Opposition to our activities may also result from general opposition to nuclear
energy and mining. Opposition to our business activities are beyond our control.
Any opposition to our business activities may cause a disruption to our business
activities and may result in increased costs, and this could have a material
adverse effect on our business and financial condition.

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We are 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, permitting and licensing activities, volatility in stock
prices, or failure to comply with disclosure obligations. The results of
litigation and proceedings cannot be predicted with certainty, and may include
injunctions pending the outcome of such litigation and proceedings. Failure to resolve
any such disputes favorably may have a material adverse
impact on our financial performance, cash flow and results of operations.

We are subject to costs associated with decommissioning
and reclamation of our properties.

As owner and operator of the White Mesa Mill, the Nichols Ranch
Project, and numerous uranium and uranium/vanadium projects and other facilities
located in the United States and certain permitting, construction, development
and exploration properties, and for so long as we remain an owner thereof, we
are obligated to eventually reclaim or participate in the reclamation of such
properties. Most, but not all, of our reclamation obligations are bonded, and
cash and other assets have been reserved to secure a portion, but not all, of
this bonded amount. Although our 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 our financial
statements. Further, to the extent the bonded amounts are not fully
collateralized, we will be required to come up with additional cash to perform
our reclamation obligations when they occur.

Decommissioning plans for our 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. Over time, further regulatory review of the
decommissioning plans may result in additional decommissioning requirements,
associated costs and the requirement to provide additional financial assurances,
including as our properties approach or go into decommissioning. 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.

We are subject to technical innovation and obsolescence
in the uranium industry.

Requirements for our 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.
The cost competitiveness of our operations may be impacted through the
development and commercialization of other uranium mining, milling, processing
and other technologies. As a result, our competitors may adopt technological
advancements that give them an advantage over the Company.

Our mineral properties may be subject to defects in
title.

We have investigated our rights to explore and exploit all of
our material properties and, to the best of our knowledge, those rights are in
good standing. However, no assurance can be given that such rights will not be
revoked, or significantly altered, to our detriment. There can also be no
assurance that our rights will not be challenged or impugned by third parties,
including by governments, surface owners, and non-governmental organizations.

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, our properties are subject to various title
uncertainties which are common to the industry with the attendant risk that
there may be defects in 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 our material Arizona Strip properties, other
than the Wate Property, 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. We believe that all of our material Arizona Strip
projects are on valid mining claims that would withstand a mineral examination.
Further, our Arizona 1 Project has an approved PO which, absent modification,
would not require a mineral examination. Although our Canyon project also has an
approved PO, 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 are valid existing rights (a
decision which is involved in a current court challenge). 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 our mining claims being considered invalid, which could
prevent a project from proceeding.

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Certain of our properties, or significant portions thereof, are
mineral leases that have fixed terms, both with State and private parties.
Certain of our properties are subject to other agreements that may affect our
ability to explore, permit, develop and operate them, including surface use,
access and other agreements. There can be no guarantee that we will be able to
renew or extend such leases and agreements on favorable terms or at all. The
failure to renew any such leases or agreements could have a material adverse
effect on our operations.

Possible amendments to the General Mining Law could make
it more difficult or impossible for us to execute our business plan.

Members of the United States Congress have repeatedly
introduced bills which would supplant or alter the provisions of the United
States Mining Law of 1872, as amended. Such bills have proposed, among other
things, to (i) either eliminate or greatly limit the right to a mineral patent;
(ii) significantly alter the laws and regulations relating to uranium mineral
development and recovery from unpatented and patented mining claims; (iii)
impose a federal royalty on production from unpatented mining claims; (iv)
impose time limits on the effectiveness of plans of operation that may not
coincide with mine or facility life; (v) impose more stringent environmental
compliance and reclamation requirements on activities on unpatented mining
claims; (vi) establish a mechanism that would allow states, localities and
Native American tribes to petition for the withdrawal of identified tracts of
federal land from the operation of the U.S. general mining laws; and (vii) allow
for administrative determinations that mining or similar activities would not be
allowed in situations where undue degradation of the federal lands in question
could not be prevented. If enacted, such legislation could change the cost of
holding unpatented mining claims and could significantly impact our ability to
develop locatable mineral resources on our patented and unpatented mining
claims. Although it is impossible to predict at this point what any legislated
royalties might be, enactment could adversely affect the potential for
construction and development and the economics of existing operating mines and
facilities. Passage of such legislation could adversely affect our financial
performance.

In addition to the withdrawal noted in the previous risk
factor, there are currently other proposed withdrawals of federal lands for the
purposes of mineral location and development and proposed designations of
national monuments which would have a similar effect as a withdrawal. While such
proposals are not yet final and would require further federal action, if they
were to occur, it is uncertain whether any such withdrawals or designations
would affect in any manner our current mineral projects.

Because we may be unable to secure access rights to
certain of our properties, we may be unable to explore and/or advance such
properties.

We are currently in the process of negotiating access rights to
certain of our properties, such as the Roca Honda Project and the Wate Project,
with private landholders. There can be no guarantee that we will be able to
negotiate such access rights on favorable terms, or at all. The failure to
negotiate such access rights on suitable terms could have a material adverse
effect on our operations.

We are subject to foreign currency risks.

Our operations are subject to foreign currency fluctuations.
Our operating expenses and revenues are primarily incurred in U.S. dollars,
while some of our 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 on our profitability and may also affect the value
of our assets and shareholders equity. In addition, the recent strengthening of
the U.S. dollar relative to other currencies makes our mineral extraction and
recovery less competitive in relation to similar activities in other countries.
Current and future strengthening of the U.S. dollar in relation to the
currencies of other countries can have a material impact on our cash flows and
profitability, and affect the value of our assets and shareholders equity.

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We may not realize the anticipated benefits of previous
acquisitions.

We may not realize the anticipated benefits of acquiring: the
Sheep Mountain Project in 2012; Denison Mines Corps US Mining Division in 2012,
including the White Mesa Mill, certain of the Arizona Strip Properties, the
Henry Mountains Complex, the La Sal Project, and the Daneros Project; Strathmore
in 2013, including the Roca Honda Project; and Uranerz in 2015, including the
Nichols Ranch Project, due to integration, operational and uranium market
challenges. Decreases in commodity prices have required us to place a number of
acquired properties and facilities on standby and to defer permitting and
construction and development activities on certain other acquired assets, until
market conditions warrant otherwise, and in some cases we have elected to sell
or abandon certain of these properties at a loss. Our success following those
acquisitions will depend in large part on the success of our management in
integrating the acquired assets into the Company. Our failure to achieve such
integration and to mine or advance such assets could result in our failure to
realize the anticipated benefits of those acquisitions and could impair our
results of operations, profitability and financial results.

We prepare estimates of future uranium extraction and
recovery, and there are no assurances that such estimates will be achieved.

We may from time to time prepare estimates of future uranium
extraction and recovery, or increases in uranium extraction and recovery, for
particular operations, or relating to our ability to increase uranium extraction
and recovery in response to increases in commodity prices, as market conditions
warrant or otherwise. No assurance can be given that any such extraction and
recovery estimates will be achieved, nor can assurance be given that extraction
or recovery increases will be achieved in a cost effective or timely manner.
Failure to achieve extraction and recovery estimates or failure to achieve
extraction and recovery in a cost effective or timely manner could have an
adverse impact on our future cash flows, earnings, results of operations and
financial condition. These estimates are based on, among other things, the
following factors: the accuracy of mineral resource and reserve estimates; the
accuracy of assumptions regarding ground conditions and physical characteristics
of mineralized materials, such as hardness and presence or absence of particular
metallurgical characteristics; the accuracy of estimated rates and costs of
extraction, recovery 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.

Our actual uranium extraction and recovery may vary from
estimates for a variety of reasons, including, among others: actual mineralized
material extracted, mined or recovered varying from estimates of grade, tonnage,
dilution and metallurgical and other characteristics; short term operating
factors relating to the mineral resources and reserves, such as the need for
sequential construction or development of mineralized materials or deposits and
the processing of new or different mineral grades; risk and hazards associated
with extraction, mining and recovery; 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.

We depend on the issuance of license amendments and
renewals which cannot be guaranteed.

We maintain regulatory licenses and permits in order to operate
our White Mesa Mill and Nichols Ranch Project, all of which are subject to
renewal from time to time and are required in order to operate in compliance
with applicable laws and regulations. In addition, depending on our business
requirements, it may be necessary or desirable to seek amendments to one or more
of our licenses or permits from time to time. While we have been successful in
renewing our 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.

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Mining, mineral extraction, recovery and milling are
subject to a high degree of risk, and we are not insured to cover against all
potential risks.

Our operations and activities are subject to all of the hazards
and risks normally incidental to exploration, construction, development,
extraction and mining of mineral properties, and recovery, processing 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 our production and recovery processes; the ability to
procure mining and other equipment and operating and other supplies in
sufficient quantities and on a timely basis; and other extraction, mining,
recovery, milling, and processing risks, as well as risks associated with our
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, our mineral properties or processing or recovery
facilities, personal injury or death, environmental damage, delays in or
interruption of or cessation of extraction, mining, production and recovery from
our mines or processing facilities or in our exploration, construction or
development activities, delay in or inability to receive regulatory approvals to
transport our 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 extraction, mining,
recovery, and processing, additional costs and risks are incurred by us on a
regular and ongoing basis.

While we may obtain insurance against certain risks in such
amounts as we consider 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 we cannot insure or against which we 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 our future earnings, financial
position and competitive position. 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 us.

We will need to continuously add to our mineral reserve
and resource base and toour alternate feed
materials.

Our properties do not contain any mineral reserves under SEC
Industry Guide 7. See Cautionary Note to United States Investors Concerning
Disclosure of Mineral Reserve and Mineral Resource Estimates above.

Our material mineral resources are located at the Nichols Ranch
Project, the Canyon Project, the Roca Honda Project, the Sheep Mountain Project,
the Henry Mountains Complex, the La Sal Project,  and the Daneros Project. These projects are our primary sources (and potential sources)
of current and future uranium concentrates. Unless other mineral resources or
reserves are discovered or extensions to existing resource bodies are found, our
sources of extraction, production and recovery for uranium concentrates will
decrease over time as our current mineral resources are depleted. There can be
no assurance that our future exploration, construction, development and
acquisition efforts will be successful in replenishing our mineral resources or
finding or developing reserves. In addition, while we believe that many of our
properties will eventually engage in extraction or mining activities, there can
be no assurance that they will be placed into such activities, or that they will
be able to replace current extraction or mining activities.

We also recover uranium from processing alternate feed
materials at our 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 we 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.

Our sales of uranium and vanadium products expose us to
the risk of non-payment.

28

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Our sales of uranium and vanadium products expose us to the
risk of non-payment. We manage this risk by monitoring the credit worthiness of
our customers and requiring pre-payment or other forms of payment security from
customers with an unacceptable level of credit risk. Most of the Companys sales
are to major nuclear utilities, which pose a relatively low risk of non-payment
due to their large size and capitalization.

We are dependent on key personnel and qualified and
experienced employees.

Our success will largely depend on the efforts and abilities of
certain senior officers and key employees, some of whom 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 we do not foresee any reason why such officers and key
employees will not remain with us, other than through retirement, if for any
reason they do not, we could be adversely affected. We have not purchased key
man life insurance for any of these individuals, other than for our Chief
Executive Officer.

Our success will also depend on the availability of qualified
and experienced employees to work in our operations and our ability to attract
and retain such employees. The number of individuals with relevant mining and
operational experience in this industry, especially the U.S. uranium industry,
is small.

If we fail to maintain an effective system of internal
control, we may not be able to accurately report financial results or prevent
fraud.

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.

We are dependent on business partners, government and
third party consents.

We have a number of joint ventures and other business
relationships relating to our properties and projects, including key projects,
such as the Roca Honda Project and Arkose Mining Venture, which can restrict our
ability to act unilaterally with respect to those projects in certain
circumstances. There can be no assurances that we will be able to maintain
relationships with our joint venture and business partners to allow for
satisfactory exploration, permitting, construction, development, extraction,
mining, recovery or milling relating to any such projects. Our operations and
activities 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.

Certain of our directors may be in a position of conflict
of interest with respect to the Company due to their relationship with other
resource companies.

Some of our directors 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 may be offered to
another company or companies with which the director is associated, and may not
be presented or made available to us. Our directors 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 our Code
of Ethics and by the Business Corporations Act (Ontario).

Our relationship with our employees may be impacted by
changes in labor relations.

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

29

---

Mining, extraction, recovery, processing, construction,
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. We consider the
existing infrastructure to be adequate to support our proposed operations and
activities. However, unusual or infrequent weather phenomena including drought,
sabotage, government, or other interference in the maintenance or provision of
such infrastructure could adversely affect our operations and activities,
financial condition and results of operations.

Because the probability of an individual prospect ever
having reserves as defined by the SEC is not known, our properties may not
contain any reserves, and any funds spent on exploration may be lost.

We have no reserves as defined by SEC Industry Guide 7, and our
Nichols Ranch Project only recently commenced generating revenue from
operations. Because the probability of an individual prospect ever having
reserves is uncertain, our properties may not contain any reserves, and any
funds spent on exploration, construction, development, extraction, and recovery
may be lost. We do not know with certainty that economically recoverable uranium
exists on any of our properties as defined by SEC Industry Guide 7. Further,
although we have commenced uranium extraction activities at our Nichols Ranch
Project, our lack of established reserves means that we are uncertain as to our
ability to continue to generate revenue from our operations. We may never
discover uranium in commercially exploitable quantities and any identified
deposit may never qualify as a commercially mineable (or viable) reserve. We
will continue to attempt to acquire the surface and mineral rights on lands that
we think are geologically favorable or where we have historical information in
our possession that indicates uranium mineralization might be present.

The exploration and, if warranted, construction relating to or
development of mineral deposits involves significant financial and other risks
over an extended period of time, which even a combination of careful evaluation,
experience and knowledge may not eliminate. Few properties which are explored
are ultimately developed into producing mines. Major expenditures are required
to establish reserves by drilling and to construct mining and processing
facilities at a site. Our uranium properties are all classified under SEC
Industry Guide 7 to be at the exploration stage and do not contain any reserves
at this time. It is impossible to ensure that the current or proposed
exploration programs and other activities on properties in which we have an
interest will result in the delineation of mineral reserves or in profitable
commercial operations. Our operations and activities are subject to the hazards
and risks normally incident to exploration and production of uranium, precious
and base metals, any of which could result in damage to life or property,
environmental damage and possible legal liability for such damage. While we may
obtain insurance against certain risks, the nature of these risks is such that
liabilities could exceed policy limits or could be excluded from coverage. There
are also risks against which we cannot insure or against which we 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 our future earnings and
competitive position and, potentially our financial viability.

We are a Canadian company, and U.S. investors may have
difficulty bringing actions and enforcing judgments under U.S. securities laws.

Investors in the United States or in other jurisdictions
outside of Canada may have difficulty bringing actions and enforcing judgments
against us, our directors, our executive officers and some of the experts named
in this Annual Report on Form 10-K based on civil liabilities provisions of the
federal securities laws or other laws of the United States or any state thereof
or the equivalent laws of other jurisdictions of residence.

If the Company becomes a passive foreign investment
company in the current or future tax years, adverse U.S. federal income tax
consequences for U.S. investors may result.

If the Company were to constitute a passive foreign investment
company (PFIC) for any year during a
U.S. Holder's holding period, then certain potentially adverse rules would
affect the U.S. federal income tax consequences to a U.S. Holder resulting from
the acquisition, ownership and disposition of the Company's securities. The Company believes that it was not a PFIC during
the prior tax year ended on December 31, 2015, and based on current business
plans and financial expectations, the Company expects that it will not be a PFIC
for the current tax year and expects that it will not be a PFIC for the foreseeable future. No opinion of legal
counsel or ruling from the IRS concerning the status of the Company as a PFIC
has been obtained or is currently planned to be requested. PFIC classification
is fundamentally factual in nature, generally cannot be determined until the
close of the tax year in question, and is determined annually. Additionally, the
analysis depends, in part, on the application of complex U.S. federal income tax
rules, which are subject to differing interpretations. Consequently, there can
be no assurance that the Company has never been, is not, and will not become a
PFIC for any tax year during which U.S. Holders hold the Company's securities.

30

---

In addition, in any year in which the Company is classified as
a PFIC, U.S. Holders will be required to file an annual report with the IRS
containing such information as Treasury Regulations and/or other IRS guidance
may require. In addition to penalties, a failure to satisfy such reporting
requirements may result in an extension of the time period during which the IRS
can assess a tax. U.S. Holders should consult their own tax advisors regarding
the requirements of filing such information returns under these rules, including
the requirement to file an IRS Form 8621.

The Company will be a PFIC under
  Section 1297 of the Code if, for a tax year, (a) 75% or more of the gross income
  of the Company for such tax year is passive income (the income test) or
  (b) 50% or more of the value of the Company's assets either produce passive
  income or are held for the production of passive income (the asset
    test), based on the quarterly average of the fair market value of such
  assets. Gross income generally includes all sales revenues less the
  cost of goods sold, plus income from investments and from incidental or outside
  operations or sources, and "passive income" generally includes, for example,
  dividends, interest, certain rents and royalties, certain gains from the sale of
  stock and securities, and certain gains from commodities transactions. In
  addition, for purposes of the PFIC income test and asset test described above,
  if the Company owns, directly or indirectly, 25% or more of the total value of
  the outstanding shares of another corporation, the Company will be treated as if
  it (a) held a proportionate share of the assets of such other corporation and
  (b) received directly a proportionate share of the income of such other
  corporation.

Under certain attribution rules, if the Company is a PFIC, U.S.
Holders will be deemed to own their proportionate share of any subsidiary of the
Company which is also a PFIC (a Subsidiary PFIC), and will be subject
to U.S. federal income tax on (i) a distribution on the shares of a Subsidiary
PFIC or (ii) a disposition of shares of a Subsidiary PFIC, both as if the holder
directly held the shares of such Subsidiary PFIC.

If the Company were a PFIC in any tax year and a U.S. Holder
held the Company's securities, such holder
generally would be subject to special rules under Section 1291 of the Code with
respect to "excess distributions" made by the Company on said securities and with respect to gain from the disposition of
said securities. An excess distribution
generally is defined as the excess of distributions with respect to securities
of the Company, received by a U.S Holder in any tax year over
125% of the average annual distributions such U.S. Holder has received from the
Company during the shorter of the three preceding tax years, or such U.S.
Holder's holding period for the securities, as
applicable. Generally, a U.S. Holder would be required to allocate any excess
distribution or gain from the disposition of the securities ratably over its holding period for the
securities. Such amounts allocated to the
year of the disposition or excess distribution would be taxed as ordinary
income, and amounts allocated to prior tax years would be taxed as ordinary
income at the highest tax rate in effect for each such year and an interest
charge at a rate applicable to underpayments of tax would apply.

While there are U.S. federal income tax elections that
sometimes can be made to mitigate these adverse tax consequences (including,
without limitation, the QEF Election" under Section 1295 of the Code
and the Mark-to-Market Election under Section 1296 of the Code), such
elections are available in limited circumstances and must be made in a timely
manner. Under proposed Treasury Regulations, if a U.S. Holder has an option,
warrant, or other right to acquire stock of a PFIC, such
option, warrant or right is considered to be PFIC stock subject to the default
rules of Section 1291 of the Code that apply to "excess distributions" and
dispositions described above. However, under the proposed Treasury Regulations,
for the purposes of the PFIC rules, the holding period for any shares
acquired upon the exercise of such an option, warrant or right will begin on the date a U.S. Holder
acquires the underlying security (and not the date the securities are exercised). This
will impact the availability, and consequences, of the QEF Election and
Mark-to-Market Election with respect to the shares issued on exercise of the
option, warrant or right. Holders should consult
their own tax advisers regarding the potential application of the PFIC rules to
the ownership and disposition of Company securities, and the availability of certain U.S. tax elections under the PFIC rules.

31

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U.S. Holders should be aware that, for each tax year, if any,
that the Company is a PFIC, the Company can provide no assurances that it will
satisfy the record keeping requirements of a PFIC, or that it will make
available to U.S. Holders the information such U.S. Holders require to make a
QEF Election with respect to the Company or any Subsidiary PFIC. U.S. Holders
should consult with their own tax advisors regarding the potential application
of the PFIC rules to the ownership and disposition of Company securities, and the availability of certain U.S. tax
elections under the PFIC rules.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

32

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ITEM 2. DESCRIPTION OF PROPERTIES

Cautionary Note to U.S. Investors:Information contained
in this item differs from the disclosure requirements of the SEC applicable to
U.S.-incorporated domestic issuers. This Item 2 and other sections of this
Annual Report contain the terms measured mineral resources, indicated mineral
resources, inferred mineral resources, proven mineral reserves, and
probable mineral reserves as defined in accordance with NI 43-101. See
Cautionary Note to United States Investors Concerning Disclosure of Mineral
Resources, at the beginning of this Annual Report for definitions and
further discussion on the differences between terms under NI 43-101 and SEC
Industry Guide 7.



33

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Overview

Energy Fuels is engaged in conventional and ISRuranium
extraction and recovery, along with the exploration, permitting and evaluation
of uranium properties in the United States.

As described above, the Companys activities are divided into
two segments: the ISR Uranium Segment and the Conventional Uranium Segment.

ISR Uranium Segment

The Company conducts its ISR recovery activities through its
Nichols Ranch Project, located in northeast Wyoming, which it acquired in June
2015 through the acquisition of Uranerz. The Nichols Ranch Project includes: (i)
the Nichols Ranch Plant; (ii) the Nichols Ranch Wellfields; (iii) the Jane Dough
Property, and; (iv) the Hank Project, which includes the permitted but not
constructed Hank Satellite Plant and the Hank Property. See The Nichols
Ranch ISR Project below. Also through the acquisition of Uranerz, the
Company acquired the Reno Creek Property, the West North Butte Property, the
North Rolling Pin Property, and the Arkose Mining Venture, a joint venture of
ISR properties held 81% by Energy Fuels. See Non-Material Mineral Properties
 Other ISR Projects below.

Upon successful completion of the Mesteña Acquisition described
under Subsequent Events in Item 1 above, the Mesteña properties,
including the Alta Mesa Project in South Texas, will also be included in the
Companys ISR Uranium Segment.

Conventional Uranium Segment

The Company conducts its conventional uranium extraction and
recovery activities through its White Mesa Mill, which is the only operating
conventional uranium mill in the United States. The White Mesa Mill, located
near Blanding Utah, is centrally located such that it can be fed by a number of
the Companys uranium and uranium/vanadium projects in Colorado, Utah, Arizona
and New Mexico, as well as by ore purchase or toll milling arrangements with
third party miners in the region, as market conditions warrant. The Company also
owns the Sheep Mountain Project in Wyoming, which is a conventional uranium
project in an advanced stage of permitting. Due to its distance from the White
Mesa Mill, the Sheep Mountain Project is not expected to be a source of feed
material for the Mill. The Sheep Mountain Project consists of the Sheep Mountain
Extraction Operation and the proposed Sheep Mountain Processing Operation.

The Companys principal conventional properties include the
following:

| | the White Mesa Mill. See The White Mesa Millbelow;                                                                                                                                                                                                                                                                                                                   
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | the Arizona Strip uranium properties located in north
      central Arizona, including: the Canyon Project, (see The Canyon
      Project below); the Wate Project; the Arizona 1 Project; the Pinenut
      Project (now in reclamation), and the EZ Project. See Non-Material
      Mineral Properties  Other Conventional Projects  Arizona Strip
      below;
| | a 60% interest in the Roca Honda Project. The Company has
      signed a non-binding letter of intent to acquire the other 40% interest in
      the Roca Honda Project from its joint venture partner. See The Roca
      Honda Project below;                                                                                                                      
| | the Sheep Mountain Project See The Sheep Mountain
      Project below;                                                                                                                                                                                                                                                                                               
| | the Henry Mountains Complex comprised of the Tony M
      Property and the Bullfrog Property. See The Henry Mountains
      Complex below;                                                                                                                                                                                                                           
| | the La Sal Project (see The La Sal Project
      below), the Whirlwind Project, and the Sage Plain Project, in addition to
      nearby exploration properties. See Non-Material Mineral Properties 
      Other Conventional Projects  Colorado Plateau below;                                                                                                  
| | the Daneros Project. See The Daneros Project
      below; and                                                                                                                                                                                                                                                                                                        
| | a number of non-core properties, which the Company is
      evaluating for sale or abandonment. See Non- Material Mineral
      Properties below.                                                                                                                                                                                                                    

The material projects are shown on the map above and are
described in further detail below. Properties which the Company does not
consider material are summarized at the end of this Item 2.

34

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Uranium and Vanadium Recovery History

The following tables show the mineralized material processed
  and pounds of uranium and vanadium recovered from the Companys projects and
  facilitiesfrom 2011 to December 31, 2015(1):

Recovery History

Project or Source
    2015
    2014
    2013
    2012(1)
    2011(1)Alternate Feed Materials(2)Tons
    1,243
    1,154
    3,492
    6,998
    12,040Ave % U3O8
    9.21%
    16.94%
    5.03%
    3.09%
    0.83%Pounds
      U3O8(x1,000)
    229(3)
    391(3)
    351
    433
    200Tailing Solution Recycle and In-Circuit
      Material(4)Pounds
      U3O8(x1,000)
    67(4)
    ---
    ---
    ---
    ---Conventional Feed MaterialsTons
    ---
    49,268
    126,342
    125,485
    172,000Ave % U3O8
    ---
    0.56%
    0.26%
    0.33%
    0.24%Pounds U3O8 (x1,000)
    ---
    552
    655
    836
    811Nichols Ranch(5)Pounds U3O8 (x1,000)
    273
    200
    ---
    ---
    ---Total Pounds U3O8Recovered (x1,000)
    570
    1,143
    1,007
    1,269
    1,011Total Pounds V2O5Recovered (x1,000)
    ---
    ---
    1,303
    235
    1,290


| |     | Notes:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Mineralized material is shown as being processed and
      pounds recovered during the year in which the materials were processed at
      the White Mesa Mill or at the Nichols Ranch Plant, which is not
      necessarily the year in which the materials were extracted from the
      project facilities. It should also be noted that production to June 29,
      2012 and all of 2011 pre-dates the Companys ownership of the  US
      Mining Division, and was therefore for the account of the previous
      owner.                                                                                                         
| | (2) | All alternate feed materials were processed at the White
      Mesa Mill. A number of different alternate feed materials were processed
      during the period  2011  2015. The table shows the average uranium
      grades and the total pounds recovered from all alternate feed materials
      processed at the Mill during each of the years in that period.                                                                                                                                                                                                                                                                     
| | (3) | The 229,000 pounds recovered in 2015 includes 72,281
      pounds recovered for the accounts of third parties, and the 391,000 pounds
      recovered in 2014 includes 85,000 pounds recovered for the accounts of
      third parties.                                                                                                                                                                                                                                                                                                                                                                                                  
| | (4) | Pounds contained in tailings solutions containing
      previously unrecovered uranium, together with in-circuit mineralized
      material from previous conventional ore processing, were recovered by
      processing alternate feed materials at the White Mesa Mill, though tons
      and grade are not available because it cannot be tied to any specific
      source. Of these 67,000 pounds, 25,000 pounds are attributed to in-circuit
      material from previous conventional ore processing.                                                                                                                            
| | (5) | Uranium recovery commenced at the Nichols Ranch Project
      on April 17, 2014. Because the Nichols Ranch Project uses ISR instead of
      conventional extraction methods, grade and tons of ore are inapplicable to
      the Nichols Ranch Project. The data in the table include all uranium
      recovered from the Nichols Ranch Project, both before and after the
      Company acquired Uranerz and the Nichols Ranch Project. Of the total
      pounds recovered at the Nichols Ranch Project in 2015, approximately
      172,000 pounds were recovered after June 18, 2015, and are for the account
      of the Company.

35

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Mineral Extraction

The following table shows the extraction history from 2011 to
December 31, 2015 from the mineral properties currently owned by the Company.
Much of the material was stockpiled at the White Mesa Mill for a year or more
before being processed. Since mineralized material is processed on a continuing
basis during a Mill run and remains in-circuit for a considerable time mixed
with all other mill feed, it is not possible to tie uranium and vanadium
recovery to each project; therefore, pounds of extracted uranium and vanadium
are not included in this table, except for the Nichols Ranch Project where
annual extraction can be tracked.

Project(1)
    2015
    2014
    2013
    2012(1)
    2011(1)Arizona 1(2)Tons
    ---
    3,893
    16,280
    30,311
    39,900% U3O8
    
    0.56%
    0.58%
    0.62%
    0.66%Pinenut(3)Tons
    30,100
    43,030
    7,597
    120
    ---% U3O8
    0.54%
    0.55%
    0.53%
    0.48%DanerosTons
    ---
    ---
    ---
    42,532
    34,368% U3O8
    
    
    
    0.27%
    0.28%La Sal(4)Tons
    ---
    ---
    ---
    75,379
    89,430% U3O8
    
    
    
    0.22%
    0.225%% V2O5
    
    
    
    1.20%
    1.20%Nichols Ranch(5)Pounds
    273,000
    199,509
    -


| |     | Notes:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | All properties reported in this table are owned by the
      Company on December 31, 2015, but were acquired by the Company in either
      June 2015 as part of the Uranerz acquisition or June 2012 as part of the
      acquisition of the  US Mining Division. Properties sold or
      otherwise disposed of are not included in this table. Production prior to
      June 29, 2012 and all of 2011 pre-dates the Companys ownership of the US Mining Division, and was therefore for the account of the
      previous owner.
| | (2) | The Arizona 1 Project was placed on standby in February
      2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (3) | The Pinenut Project was placed into reclamation in August
      2015 due to the depletion of the identified resources.                                                                                                                                                                                                                                                                                                                                                                                                               
| | (4) | The La Sal Project includes the Beaver and Pandora
      Properties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (5) | Uranium recovery commenced at the Nichols Ranch Project
      on April 17, 2014. Of the total pounds recovered at the Nichols Ranch
      Project in 2015, approximately 172,000 pounds were recovered after June
      18, 2015, and are for the account of the Company.                                                                                                                                                                                                                                                            

Summary of Mineral Reserves and Resources

Richard White, CPG#08792, the Companys Chief Geologist, is
responsible for the disclosure of scientific or technical information concerning
mineral projects in this Annual Report.

The following tables show the Company's estimate of Mineral
Reserves and Mineral Resources as of December 31, 2015. NI 43-101 requires
mineral companies to disclose Mineral Reserves and Mineral Resources using the
subcategories of Proven Mineral Reserves, Probable Mineral Reserves, Measured
Mineral Resources, Indicated Mineral Resources and Inferred Mineral Resources.
Energy Fuels reports Mineral Reserves and Mineral Resources separately.
Properties sold or otherwise disposed of during 2015 are not included in the
table. These properties include the Marquez and Nose Rock properties. Except as
stated below, the Mineral Reserve and Mineral Resource information shown below
is as reported in the various technical reports prepared in accordance with NI
43-101 (the Technical Reports) by qualified persons employed by Peter
Geosciences, BRS Engineering, Chlumsky, Armbrust, and Meyer, SRK Consulting (US)
Inc., and Roscoe Postle Associates Inc. See Mineral Projects below.The
table below also reflects the Companys adjustments to the resources as of
December 31, 2015 at the properties where exploration and well installation
drilling and/or extraction were in progress in 2015; notably at the Nichols
Ranch Project. The Pinenut Project has been removed from the table since
extraction of all known resources was completed during 2015. The Daneros Project shows a reduction
relative to its Technical Report reflecting the extraction in 2012 after that
Technical Reports effective date.

36

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Probable Mineral Reserve
Estimates(1)-- Uranium

Deposit
    Tons 
      (,000)
    Grade %
      
      U3O8
    Pounds
      
    U3O8(,000)Sheep Mountain  Congo Pit Probable Reserve
    3,955
    0.115%
    9,117Sheep Mountain  Underground Probable Reserve
    3,498
    0.132%
    9,248White Mesa  Stockpile(2)
    43
    0.54%
    468Total Mineral Reserves (klbs.
      eU3O8)
    7,496
    
    18,833


| | (1) | The reserves in this table were calculated in accordance
      with NI 43-101 and do not represent reserves under SEC Industry Guide 7.
      Mineral Resources that are not reserves under SEC Industry Guide 7 do not
      have demonstrated economic viability.                                                                                       
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | White Mesa  Stockpile includes stockpiled materials as
      of March 4, 2016 which have been extracted from the Pinenut Project, where
      mineral reserve and mineral resource estimates have been prepared in
      accordance with NI 43-101. All mineral resources have been extracted from
      the Pinenut Project, and it is in reclamation.

Mineral Resource Estimate Uranium(1)(2)(3)

|                                              | Measured Mineral Resources | Indicated Mineral Resources | Inferred Mineral Resources
|--------------------------------------------- | -------------------------- | --------------------------- | --------------------------
|                                              | Tons 
    (,000)           | Grade 
    % 
    eU3O8     | Lbs.
    eU3O8      (,000)
|ISR Properties                               
|Nichols
      Ranch(4)                        | 536                        | 0.140%                      | 1,503                     
|Reno Creek                                    | 2,281                      | 0.061%                      | 2,782                     
|Other Powder River Basin Properties (5)       | 310                        | 0.062%                      | 387                       
|ISR
      Subtotal                            | 4,672                      |                             |                           
|Conventional
      Properties                
|Canyon                                        |                            |                             |                           
|Roca
      Honda(6)                           | 208                        | 0.477%                      | 1,984                     
|Sheep
      Mountain(7)                       |                            |                             |                           
|Henry Mountains                               |                            |                             |                           
|La
      Sal(8)                               | 1,010                      | 0.18%                       | 3,733                     
|Daneros                                       |                            |                             |                           
|Other
      Properties(9)                     | 444                        | 0.17%                       | 1,540                     
|Conventional Subtotal                         | 7,257                      |                             |                           
|Properties Held for
      Sale               
|Gas Hills                                     |                            |                             |                           
|Juniper Ridge                                 |                            |                             |                           
|For
      Sale Subtotal                       |                            |                             |                           
|Total Mineral Resources (kLbs.
    eU3O8)(10) | 11,929                     |                             |                           

37

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*Mineral Resource Estimate  Vanadium
(1)(2)(3)*

Measured Mineral Resources
    Indicated Mineral Resources
    Inferred Mineral ResourcesTons
      (,000)
    Grade
    Lbs. V2O5 (,000)
    Tons 
      (,000)
    Grade
    Lbs. V2O5 (,000)
    Tons 
      (,000)
    Grade
    Lbs. V2O5(,000)La Sal(8)
    1,010
    0.97%
    19,596
    132
    0.73%
    1,930
    185
    0.51%
    1,902Other Properties(11)
    444
    1.43%
    12,714
    216
    0.96%
    4,163
    449
    0.75%
    6,756Total Mineral Resources (Lbs.V2O5)(10)
    32,310
    
    
    6,093
    
    
    8,658


Notes

| | (1)  | Mineral Resources that are not reserves do not
      have demonstrated economic viability. The resources in this table were
      calculated in accordance with NI 43-101 and do not represent reserves
      under SEC Industry Guide 7.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2)  | The Measured and Indicated Mineral Resources were
      estimated at various block cut-off grades specifically appropriate to the
      deposit type.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (3)  | The Inferred Mineral Resources were estimated at various
      block cut-off grades specifically appropriate to the deposit
  type.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (4)  | The number shown represents the total mineral resources
      for the Nichols Ranch Project, which is comprised of three properties: the
      Nichols Ranch Wellfield, the Hank Property and the Jane Dough Property. A
      portion of the Jane Dough Property is held through the Arkose Mining
      Venture, in which the Company has an 81% interest; therefore, of these
      resources, approximately 1,405, 5,500 and 1,112 pounds of measured  mineral resources, indicated mineral resources, and inferred mineral
      resources, respectively, are for the account of the Company and the
      remainder are for the account of the other joint venture participant. The Nichols Ranch Wellfield and Hank Property are 100% owned by the Company. This number
      differs from the Nichols Ranch Technical Report number due to adjustments
      made by the Company by subtracting recovered material (272,844 pounds) and
      adding additional resources discovered by drilling during well field
      installation (~82,000 pounds).
| | (5)  | The other Powder River Basin ISR properties include: the
      North Rolling Pin Property, the West North Butte Property, East North
      Butte property, the Willow Creek property, and the East Buck, Little
      Butte, Sand Rock and South Doughstick properties in the Arkose Joint
      Venture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (6)  | The number shown represents the total mineral resources
      for the Roca Honda Project. Energy Fuels currently owns 60% of the
      Project, but has entered into a letter of intent to acquire the remaining
      40% of the Project. See Subsequent Events in Item 1
  above). The numbers do not include the historical resource estimate for the
      adjacent Roca Honda Properties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (7)  | The Sheep Mountain Indicated Mineral Resource includes
      Probable Mineral Reserves calculated in accordance with NI 43-101 of
      18,365,000 pounds of eU3O8 in 7,453,000 tons at a
  grade of 0.123%. Such mineral reserves do not constitute reserves under SEC
      Industry Guide 7.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (8)  | The La Sal Project includes the Energy Queen, Redd Block,
      Beaver, and Pandora properties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (9)  | This includes the Wate Project, the Arizona 1 Project,
      the EZ Project, the Whirlwind Project, the Sage Plain Project, and the
      Torbyn property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (10) | All numbers in this table are rounded, and therefore are
      not identical to the numbers in the respective Technical
Reports.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (11) | This includes the Whirlwind Project, the Sage Plain
      Project, and the Torbyn property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

38

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The Nichols Ranch Project



Unless stated otherwise, the following description of the
Nichols Ranch Project is derived from a technical report titled Nichols Ranch
Uranium Project, 43-101 Technical Report, Preliminary Economic Assessment dated
February 28, 2015, prepared by Douglas L. Beahm, P.E., P.G. of BRS Engineering
and Paul Goranson, P.E. of the Company, in accordance with NI 43-101 (the
Nichols Ranch Technical Report). The Nichols Ranch Technical Report
includes an updated NI 43-101 mineral resource estimate and the results of a
Preliminary Economic Assessment (PEA) for the uranium resources
identified to date at the Nichols Ranch Project. Each of the authors are
qualified persons within the meaning of NI 43-101, and Mr. Beahm is
independent of the Company within the meaning of NI 43-101. Because the
independent author of the Nichols Ranch Technical Report assumed overall
responsibility for all items of the technical report, the report is therefore an
independent technical report under NI 43-101. The Nichols Ranch Technical Report
is available on SEDAR at www.sedar.com. The Nichols Ranch Project does
not have known reserves, and is therefore considered under SEC Industry Guide 7
definitions to be exploratory in nature, despite currently ongoing uranium
recovery activities.

Property Description and Location

The Nichols Ranch Project is the Companys currently
active ISR uranium recovery
project, which it acquired in June 2015 through the acquisition of Uranerz. It
is located in the Powder River Basin of northeast Wyoming. The Nichols Ranch
Project includes: (i) the Nichols Ranch Plant; (ii) the Nichols Ranch Wellfield;
(iii) the Jane Dough Property; and (iv) the Hank Project, which includes the
planned Hank Satellite Plant and the Hank Property. The Nichols Ranch Project is
an ISR project; it is not an underground or open pit project.

A map of the Nichols Ranch Project, including the Nichols Ranch
Plant, the Nichols Ranch Wellfield, the Jane Dough Property and the Hank
Property is shown below:

39

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The Nichols Ranch Project is an operating ISR facility that
recovers uranium through a series of injection and recovery wells. Using
groundwater fortified with oxygen and sodium bicarbonate, uranium is dissolved
within a deposit. The groundwater is then collected in a series of recovery
wells and pumped to the Nichols Ranch Plant. The Nichols Ranch Plant creates a
yellowcake slurry that is transported by truck to the White Mesa Mill where it
is dried and packaged into drums that are later shipped to a conversion
facility.

The original plan for the Nichols Ranch Project included the
construction of an ISR processing facility and a second uranium recovery and
extraction facility at the Hank Project. Our current extraction plan for the
Nichols Ranch Project is now divided into three separate areas, being (i) the
Nichols Ranch Wellfield, (ii) the Jane Dough Property, and (iii) the Hank
Property. The Nichols Ranch Wellfield is, and the Jane Dough Property is
expected to be,
directly connected to the Nichols Ranch Plant via pipeline. The Hank Project
is expected to consist of a uranium extraction and recovery facility that creates a loaded
resin that will be trucked to the Nichols Ranch Plant for elution. The Nichols
Ranch Wellfield consists of our two initial production areas, being Production
Area #1 and Production Area #2. The Nichols Ranch Wellfield also includes the
two deep disposal wells that are permitted and constructed for the Nichols Ranch
Project. The Jane Dough Property is adjacent to the Nichols Ranch Wellfield to
the south and contains certain properties that are 100% owned by Energy Fuels
and other properties that are held in the Arkose Mining Venture, in which we own
an 81% interest. The Jane Dough Property contains two extraction areas that are
currently in the license and permit to mine amendment process, as described
below. The Hank Project is 100% owned by Energy Fuels and is located
approximately six miles east of the Nichols Ranch Wellfield. The Hank Satellite
Plant is fully licensed and permitted to be constructed and operate as a satellite to the Nichols
Ranch Plant, and the Hank Property contains two targeted extraction areas.

Construction of the Nichols Ranch Plant was substantially
completed in 2013, and extraction commenced in the second quarter of 2014 after
final NRC inspections were completed. The Jane Dough Property described above
will advance in permitting while we conduct uranium extraction operations at our
Nichols Ranch Wellfield. In September of 2015, the Company commenced
construction of an elution and precipitation circuit at the Nichols Ranch Plant (which was completed in early-February 2016).
Yellowcake slurry is now transported from the Nichols Ranch Plant to the White
Mesa Mill for drying and packaging. However, the Nichols Ranch Plant is
currently licensed to allow for the construction and operation of a drying and
packaging circuit should conditions warrant.

40

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The Nichols Ranch Project does not have known reserves under
SEC Industry Guide 7, and is therefore considered under SEC Industry Guide 7
definitions to be exploratory in nature. During 2015, a total of
approximately 273,000
pounds of U3O8 were recovered from the Nichols Ranch
Project, of which approximately 172,000 pounds were recovered since the Company acquired Uranerz in June 2015.

Accessibility, Local Resources, Physiography and
Infrastructure

The Nichols Ranch Project site is located approximately 50 road
miles southwest of Gillette, Wyoming and 76 road miles northeast of Casper,
Wyoming in portions of Campbell and Johnson Counties, Wyoming in the Townships
41 to 45 North and Ranges 73 to 77 West. It is accessed from State Highway 50
from the east or State Highway 387 from the south, and various internal gravel-surface county and private roads. Casper is on Interstate 25, approximately one
hour by air from either Denver, Colorado or Salt Lake City, Utah. The Nichols
Ranch Project is accessible via two-wheel drive vehicles on existing county
and/or private gravel and dirt roads.

The Nichols Ranch Project is located within the Wyoming Basin
physiographic province in the central portion of the Powder River Basin, within
the Pumpkin Buttes Mining District. The Pumpkin Buttes are a series of small
buttes rising several hundred feet above the surrounding plains. Portions of the
Powder River Basin properties are located east, west and south of these buttes.
The cap rocks on top of the buttes are erosional remnants of the Tertiary White
River Formation that is believed to have overlain the majority of the Powder
River Basin. The volcanic tuffs in the White River Formation have been cited as
a source of uranium in this basin.

The area in which the Powder River Basin properties is located
is a low lying plain, and elevations range from approximately 4,390 feet (1,440
meters) in the northwest to approximately 5,450 feet (1,790 meters) in the
southeast. Historically and currently the land is used for livestock and
wildlife grazing. Vegetation is characteristically sagebrush grassland with some
pines on elevated terrain and some deciduous trees within drainages.

The climate is semi-arid and receives an annual precipitation
of approximately 9.4 inches, the most falling in the form of late autumnal to
early spring snows. The summer months are usually hot, dry and clear except for
infrequent heavy rains. Cold, wind and snow/blizzards can make winter
exploration work in this area difficult but not impossible. The weather may
limit the time periods for capital construction but should not have any
significant adverse impacts on the operation of an ISR facility.

Infrastructure at the site of the Nichols Ranch Project is
dominantly related to local oil, gas, and coal bed methane exploration and
development. Mineralized locations could affect future siting of wellfields and
processing facilities. Generally, the proximity of the Nichols Ranch Project to
paved roads is beneficial with respect to transportation of equipment, supplies,
personnel and product to and from the property. Power transmission lines are
located on or near parts of the property. We have secured power from the local
electrical service provider to accommodate our needs. Water is available from
wells developed at planned facility locations, and water for ISR operations
comes from the operation itself, i.e. the extracted groundwater. Therefore, the
basic infrastructure (power, water and transportation) required to support an
ISR mining operation is located within reasonable proximity of the Nichols Ranch
Project.

Ownership

Our property interests vary widely, and include unpatented
mining claims, private and state leasehold interests and surface use rights.
Some agreements renew annually, some renew automatically when mineral extraction
has commenced, and some are agreements for fixed terms. For the property
agreements that expire in 2016, we have negotiated to extend the terms of most
agreements. Other than a possible increase in carrying cost, we do not expect
that the expiry of certain property interests in 2016 and beyond will have a
material effect on our ability to continue exploration and extraction activities
on our properties.

41

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Our unpatented lode mining claims are located on minerals owned
by the federal government and open to location, with the surface being owned
either by the federal government or private individuals. In addition, the
unpatented lode mining claims are recorded in the appropriate county and filed
with the state office of the BLM. The unpatented lode claims do not have an
expiration date. However, affidavits must be filed annually with the BLM and
respective county recorders offices in order to maintain the claims validity.
All of the unpatented lode mining claims have annual filing requirements ($155 per
claim) with the BLM, to be paid on or before September 1 of each year. Most of
the above-mentioned unpatented lode mining claims are located on Stock Raising
Homestead land where the United States government has issued a patent for the
surface to an individual and reserved the minerals to the United States
government subject to the location rights by claimants as set forth in the
federal Mining Act of 1872.

Our leasehold interests are subject to the various terms as set
forth in the applicable leases. The state leases and leases on fee mineral lands
usually have annual payments, royalty obligations, and the terms of the leases
vary, but for the most part can be extended by production (as defined in the
leases). The fee surface and mineral leases apply only to uranium and other
fissionable minerals and typically have a 10-year term with the right to extend
the leases with production (as defined in the leases). Commingling of extraction
from adjacent lands is allowable under the fee mineral leases.

Surface rights under applicable laws allow for exploration
disturbance, road construction and facility siting. The claimant must first
notify the surface owner of its intention to locate unpatented lode mining
claims on the owners surface and then reach an agreement with the surface owner
to pay for damages caused by the claimants operations. If an agreement cannot
be reached, the claimant may post a bond with the BLM to cover the amount of the
damages caused by the claimants operations. We have negotiated surface use
agreements with various surface owners that provide us with all required surface
access for the Nichols Ranch Project. The surface use agreements typically
provide for reimbursement to the surface owner of actual damages resulting from
our operations.

Nichols Ranch Plant  100% Uranerz

The Nichols Ranch Plant is located on the Nichols Ranch Project
property pursuant to the Surface Use Agreement described below.

Nichols Ranch Wellfield  100% Energy Fuels

The Nichols Ranch Project, which includes the Nichols Ranch
Plant and the Nichols Ranch Wellfield mining permit area, consists of 36
unpatented lode mining claims, two fee surface and mineral leases, and one
Surface Use Agreement encompassing approximately 920 acres. The Nichols Ranch
Wellfield permit boundary encompasses approximately 1,120 acres. There is an
overriding royalty interest in favor of Excalibur Industries on all federal
unpatented lode mining claims that were acquired from Excalibur Industries,
defined as a gross royalty of six percent when the spot price of uranium is less
than $45.00 per pound and of eight percent if the uranium spot price is $45.00
per pound or higher. In addition, there is a portion of the Nichols Ranch
Wellfield that includes private (fee) mineral that is subject to the above
Excalibur Industries royalty, plus an additional royalty payable to the fee
mineral owner under the fee leases (equaling a 12 percent or 16 percent royalty
depending upon the spot price of uranium). The primary term of the leases expire
in 2017, however, they can be held by production (as defined in the leases). The
primary term of the Surface Use Agreement would have expired in 2016, however
the term has been held by production.

Hank Property  100% Energy Fuels

At the Hank Project, for which the Company has received a
license to construct and operate a satellite plant to the Nichols Ranch Plant
(known as the Hank Satellite Plant), we have 66 unpatented lode mining claims,
two fee surface and mineral leases, which are not significant, and one surface
use agreement encompassing approximately 1,393 acres. The Hank Project permit
boundary encompasses approximately 2,250 acres. Of the 66 unpatented lode mining
claims comprising the Hank Project, 56 of the claims have a royalty interest
burden, payable to Excalibur Industries, of 6 or 8 percent depending on the
price of uranium. This royalty interest is based on uranium produced from these
claims. The primary term of the leases expire in 2016; however, they can be held
beyond the primary term by production (as defined in the leases). The Company
has renewed all but two of these leases through 2026.

42

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Jane Dough Property (Jane Dough/Doughstick  100% Energy
Fuels; North Jane and S. Doughstick  100% ArkoseMining Venture, held
81% by Energy Fuels)

The Jane Dough Property, for which the Company has applied to
the NRC for a license amendment to include in the Nichols Ranch Project permit
area, combines the above referenced three properties consisting of 115
unpatented lode mining claims, 16 mineral leases, and three surface use
agreements encompassing approximately 3,121 acres. Our operating interest in the
Jane Dough Property will include Energy Fuels 100% owned property and 81% from
the two properties held by the Arkose Mining Venture. The proposed Jane Dough
Property permit amendment encompasses approximately 3,680 acres. The fee land in
the project is covered by mineral leases some of which have annual payments and
some of which are five year paid up leases. The mineral leases have primary
terms of ten years and can be held by ongoing uranium extraction (as defined in
the leases). Some of the leases expire in 2016, 2017, 2018, and 2019. The fee
surface is covered by three separate Surface Use Agreements which include damage
payments paid on an annual basis. The mining leases have a variety of royalty
payments based on a fixed rate, a two tier system, or a sliding scale system.
One of the leases has a fixed royalty rate of 4% of the gross proceeds. Two of
the leases have a two-tier royalty based on the price of
U3O8 at the time of the sale, and they are 6% for a
U3O8 price less than $75.00per pound, and 8% for a
U3O8 price equal to or greater than $75.00 per
pound. Five of the leases have a sliding scale royalty that runs from a low
of 2% at a U3O8 price of $25.00 per pound up to a high of
10% for a U3O8 price of equal to or greater than $100.00
per pound. Four leases have a sliding scale royalty that runs from a low of 4.0%
at a U3O8 price of $40.00 per pound up to a high of 10%
for a U3O8 price of equal to or greater than $100.00 per
pound Four of the leases have a sliding scale royalty that runs from a low of
4.5% at a U3O8 price of $49.99 up to a high of 10% for a
U3O8 price of equal to or greater than $100.00 per pound.
There is an overriding royalty interest held by Excalibur Industries that covers
approximately 62 of the unpatented claims located in Sections 20, 21, 28 and 29,
Township 43 North, Range 76 West, and it is a two-tiered royalty based on
quarterly production of U3O8and adjusted annually by the
actual amount of U3O8sold during the previous year. The
royalty amounts are based on the average quarterly spot price for
U3O8, and they are 6% for a
U3O8price equal to or less than $45.00 per pound; and 8%
for a U3O8 price greater than $45.00 per pound. There are
twenty (20) unpatented mining claims located in Section 32, Township 43 North,
Range 76 West that have an overriding royalty interest of 0.25%. This
overriding royalty interest is based on production of uranium on said claims.
Two of the Surface Use Agreements have a two tiered royalty based on the sales
price of the U3O8 received by Uranerz, and they are 1% for
a sales price of less than $50.00 per pound; and 2% for a sales price of equal
to or greater than $50.00 per pound.

Uranium Severance Tax

We are required to pay a standard uranium industry severance
tax of approximately 4% of sales and an ad valorem tax (annual property tax
based on assessed values) to the State of Wyoming, in addition to various
maintenance, land impact and access fees and other consideration to surface
owners.

Permitting and Licensing

Energy Fuels has received all regulatory approvals necessary to
conduct extraction and uranium processing activities at the Nichols Ranch Plant
and Nichols Ranch Wellfield. In December 2010, Uranerz received its Permit to
Mine for the Nichols Ranch Project from the Wyoming Department of Environmental
Quality  Land Quality Division (WDEQ-LQD). In July 2011, Uranerz
received the Source Material License from the NRC, and construction of the
Nichols Ranch Plant immediately began.

Both the state and federal agencies analyzed all environmental
aspects of the Nichols Ranch Project including reclamation of the land surface
following extraction operations and restoration of impacted ground water.
Workplace safety and the safety of the public are also closely monitored by
regulatory agencies. We have posted a reclamation bond with the regulatory
agencies in an amount of $6.8 million to cover the total estimated cost of
reclamation by a third party as a requirement of the licenses.

The various state and federal permits and licenses that were
required and have been obtained for the Nichols Ranch Project, exclusive of the
expansion to the Jane Dough Property, and are summarized below:

Primary Permits and Licenses for the Nichols Ranch Project
(Nichols Ranch and Hank Units Only)

43

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Permit, License, of Approval Name
    Agency
    StatusSource Material License
    NRC
    ObtainedPermit to Mine (UIC Permit)
    WDEQ-LQD
    ObtainedAquifer Exemption
    WDEQ-LQD; EPA
    ObtainedPermit to Appropriate Groundwater
    SEO
    ObtainedWellfield Authorization
    WDEQ-LQD
    ObtainedDeep Disposal Well Permits
    WDEQ-WQD
    ObtainedWYPDES
    WDEQ- WQD
    ObtainedPermit to Construct Septic Leach Field
    County
    ObtainedAir Quality Permit
    WDEQ-AQD
    Obtained.


| | Notes: | NRC - Nuclear Regulatory
      Commission                                          
| | ------ | -----------------------------------------------------------------------------------
| |        | EPA  Environmental Protection
      Agency                                        
| |        | WDEQ-LQD - Wyoming Department of
      Environmental Quality Land Quality Division 
| |        | WDEQ-WQD - Wyoming Department of
      Environmental Quality Water Quality Division
| |        | WDEQ-AQD - Wyoming Department of
      Environmental Quality Air Quality Division  
| |        | WYPDES  Wyoming Pollutant
      Discharge Elimination System                      
| |        | SEO - State Engineer's Office                                                      

Under the licensed plan, the Nichols Ranch Plant has been
built, and a satellite processing facility is licensed for the Hank Project. In
March 2010, Uranerz commenced preparation of the environmental permit and
license applications for the Jane Dough Property, which is adjacent to the
Nichols Ranch Wellfield and which is expected to share its infrastructure. This
enables us to revise the original PO by bringing the Jane Dough Property into
extraction operations before the Hank Project. Due to its close proximity,
extracted solutions from the Jane Dough Property may be delivered directly to
our Nichols Ranch Plant by pipeline, thus eliminating the need for a larger
capital outlay to construct a satellite plant as is planned for the Hank
Project. Our Jane Dough Property includes the Doughstick, South Doughstick and
North Jane properties. Additional wellfields may be added to the extraction
operations plan as we continue to assess geological data. We submitted the
following applications in 2014 in order to add the Jane Dough Property to the
licensed Nichols Ranch Project: (i) a source material license amendment
application for our Jane Dough Property to the NRC to add the Jane Dough
Property to the existing license for the Nichols Ranch Project, and (ii) an
application to the Wyoming Department of Environmental Quality for an amendment
to our Permit to Mine to incorporate the Jane Dough Property. These applications
were accepted for review by the Wyoming Department of Environmental Quality in
2014 and the NRC in 2015 and are currently being processed.

Geology

The Nichols Ranch Project is located in the Powder River Basin.
The mineralized trends within the Nichols Ranch Project are alteration-reduction
trends hosted in the Eocene age channel sands that lie at depths of
approximately 300 to 1,100 feet from the surface. Roll front deposits of uranium
bearing material are anticipated to occur within these properties. An
alteration-reduction trend is a natural chemical boundary trend line in a
sandstone aquifer where reduced (non-oxidized) sand is in contact with altered
(oxidized) sand. Uranium mineralization may be found along the trend line.

The properties in the Nichols Ranch Project contain
alteration-reduction trends hosted in Eocene age channel sands.
Alteration-reduction trends in the Pumpkin Buttes Mining District are typically
composed of multiple, stacked roll front deposits that often contain associated
uranium mineralization. A stacked role front is a type of uranium occurrence
found in thick sandstone where a number of mineralization trends are stacked on
top of each other. Uranium mineralization within and adjacent to the Nichols
Ranch Project are found in the Eocene Wasatch Formation (Wasatch). The
Wasatch is a fluvial deposit composed of arkosic sandstones that are typically
25% or more feldspar grains and indicates a source rock where chemical
weathering was not extreme and the sediments have not been transported far. A
fluvial deposit is a deposit of uranium mineralization found in sandstones that
originated from sediments laid down by streams and rivers. The arkosic sandstone
is a type of sandstone that contains a high percentage of feldspar grains. The
medium grain size and relatively good sorting of this sediment implies water
transportation, probably in a meandering river/stream system. The Wasatch
formation is interlaid with sandstones, claystones, siltstones, carbonaceous
shale, and thin coal seams that overlie the Paleocene Fort Union Formation,
another fluvial sedimentary unit.

44

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History

The Nichols Ranch Project is located within the Pumpkin Buttes
Mining District which was the first commercial uranium extraction district in
Wyoming. Uranium was first discovered in the Pumpkin Buttes in 1951.
Intermittent uranium extraction from about 55 small mines occurred through 1967
producing 36,737 tons of material containing 208,143 pounds of uranium. This
  early mining activity focused on shallow oxidized deposits exploited by small
  open pit mines. The material was generally transported to the Atomic Energy
  Commission (AEC) buying station in Edgemont, South Dakota. Modern
  mining in the district has focused on deeper reduced deposits, including
  facilities operated by Cameco Corporation and Uranium One Inc.

The properties included in the Nichols Ranch Project were
originally part of a large exploration area encompassing Townships 33 through 50
North of Ranges 69 through 79 West, on the 6th principal meridian. In 1966,
Mountain West Mines Inc. (MWM, now known as Excalibur Industries) began
a successful drilling exploration program in a portion of this area. In 1967,
MWM entered into an agreement with Cleveland-Cliffs Iron Company (CCI)
for further exploration and an option if suitable resources were found. CCI
exercised its option in 1976 with plans to begin underground mining operations
in the vicinity of North Butte. Changing economic conditions and the
introduction of ISR mining technology reportedly ended much of CCIs interest in
the area. By the late 1980s, CCI began selling select properties or allowing
them to revert back to the federal government.

Between 1968 and 1980 CCI drilled 117 holes and installed 3
water wells on the Nichols Ranch Project area. Texas Eastern Nuclear Inc. in
1985 completed limited drilling and exploration on the property (approximately
28 borings) and in early 1990s Kerr McGee Corporation and Rio Algom Mining
Corporation also completed limited drilling in the area.

Mineralization

The targeted mineralized zones for the Nichols Ranch Wellfield
in the A Sand unit are 300 to 700 feet below the surface and occur in two long
narrow trends meeting at the nose. The nose is in the northwest corner of the
deposit where the two narrow trends meet to form the tip of the geochemical
front. The Hank Projects two targeted mineralized zones in the F Sand unit
range from 200 to 600 feet below the ground surface depending on the topography
and changes in the formation elevation and stratigraphic horizon. The targeted
mineralization zone for the Jane Dough Property is the A Sand unit, the same as
Nichols Ranch, at depths of 300 to 750 feet below the surface.

Present Condition of the Property and Work Completed to Date

Wellfield Development and Exploration Completed by Energy
Fuels

Prior to its acquisition by Energy Fuels in June 2015, Uranerz
drilled 257 exploration holes, including three core holes and three water wells
at the Nichols Ranch Project during 2006 and 2007 and 25 exploration holes and
seven wells in 2009. In addition, Uranerz drilled 61 exploratory holes and seven
wells within the Hank Property during 2006 and 2007 and eight additional wells
in 2009. There has been no new drilling activity at the Hank Project since 2009.
Uranerz drilled 691 exploration holes and 29 wells for baseline monitoring at
the Jane Dough Property. There has been no new drilling at the Jane Dough
Property since 2010.

Uranerz drilled a total of 78 rotary drill holes on the Hank
Property,
Nichols Ranch Wellfield, and Jane Dough Property during 2006, with 46 holes
demonstrating uranium mineralization. During 2006, environmental permitting
activities also continued at the Hank Property and Nichols Ranch Wellfields with the
completion of a total of five hydrogeologic test wells, and the drilling of six
core holes. The core was submitted for laboratory testing to support radiation
permitting requirements as well as to define resource disequilibrium
attributes.

From February 19 to December 20, 2007, Uranerz drilled a total
of 486 uranium trend delineation holes and eight hydrologic sampling wells on
the Nichols Ranch Project, utilizing as many as three drill rigs and one
electric log probing unit. This represents a total of approximately 300,000 feet
of drilling with an average depth of 617 feet per hole. A total of 214
delineation holes were drilled on Nichols Ranch in 2007. In the final months of
the 2007 drilling program, exploration efforts focused on the Hank Property and Nichols
Ranch Wellfield to facilitate sub-surface geologic mapping with cross sections
and to refine previous geologic models delineating known trends of uranium
mineralization.

During 2008 no new exploration work was undertaken at the
Nichols Ranch Wellfield.

45

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During 2009, 51 delineation holes were drilled on at the
Nichols Ranch Wellfield, including the Doughstick and North Nichols Ranch
properties. The purpose of this drilling was primarily to prepare for the
installation of baseline monitor wells for the planned Nichols Ranch Plant.
Additional drilling was carried out on the Doughstick properties.

During 2011, 38 delineation holes were drilled in 2011 on the
Nichols Ranch Wellfield. The purpose of this drilling was for final delineation
drilling prior to beginning the monitor well and extraction well installation in
Production Area #1 of the Nichols Ranch Wellfield.

During 2012, Uranerz engaged in drilling exploration efforts
and wellfield installation at Production Area #1 at the Nichols Ranch Wellfield.
At Production Area #1, 263 extraction wells were cased and cemented. The
extraction wells were connected to header houses with buried feeder lines. It
was planned that initial extraction should begin with four header houses. Three
header houses were set on their foundations in 2012 and connected to individual
extraction wells.

The Uranerz 2013 and 2014 drilling programs at the Nichols
Ranch Wellfield were restricted to adding extraction and monitor wells; no new
exploration drilling was conducted.

During 2015, Uranerz engaged in drilling exploration efforts
and wellfield installation at Production Area #1 of the Nichols Ranch Wellfield,
where 283 extraction wells were cased and cemented. At Production Area #2 of the
Nichols Ranch Wellfield, 51 monitor wells were cased and cemented. The
extraction wells were connected to header houses with buried feeder lines.
Initial extraction at the Nichols Ranch Wellfield began with four header houses.
In 2015, two additional header houses (#5 and #6) were set on their foundations
and connected to the individual extraction wells.

Current Status of Wellfields

All the currently planned and permitted wellfields are in
Production Areas #1 and #2 of the Nichols Ranch Wellfield. The Nichols Ranch
Wellfield is expected to have a total of 14 header-houses, with Production Area
#1 comprising header-houses 1 through 8, and Production Area #2 comprising
header-houses 9 through 14. Each of the two planned Nichols Ranch Wellfield
Production Areas will include a number of injection wells, recovery wells,
monitoring wells, header houses and associated piping and power supply. Header
houses will be located within the Production Areas and will distribute recovered
fluids from recovery wells to trunk lines, and injection fluids from the
processing facility through the trunk lines to injection wells. See the map
below illustrating Production Areas #1 & #2, and the plant.

46

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47

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We are currently engaged in uranium recovery activities in
Production Area #1 and, as the productivity or solution grade (uranium
concentration in the recovered ground water) of some installed patterns decreases
below the economic limit, replacement patterns will be placed into operation in
order to maintain the desired flow rate and solution grade at the processing
plant. As patterns reach their economic limit and extraction flows cease,
restoration activities will commence in these areas.

Header houses 1 through 5, and their respective wellfields, in
Production Area #1 at the Nichols Ranch Wellfield were installed and extracting
uranium at the time we acquired Uranerz in June 2015. The 6th
header-house began production in November 2015. We are scheduled to place our
7th and 8th header-houses on-line in March 2016 and July
2016, respectively, thereby completing development of Production Area #1.
Drilling and installation of production wells for these two header-houses is
proceeding at this time. In 2015, we completed installation of the monitor wells
and began baseline and hydrological testing work for Production Area #2 at the
Nichols Ranch Wellfield. Uranium recovery operations from Production Area #2 are
expected to commence in the latter part of 2016, subject to changing market
conditions.

Nichols Ranch Plant

In 2014, construction of the Nichols Ranch Plant was completed.
The Nichols Ranch Plant is licensed to produce up to two million pounds of
uranium per year through three major processing solution circuits: (i) a
recovery and extraction circuit; (ii) an elution circuit; and (iii) a yellowcake
production circuit. The Nichols Ranch Plant is currently constructed and
operated with the recovery and extraction circuit and the elution circuit
installed. We retain the ability to construct and operate a yellowcake
production circuit at the Nichols Ranch Plant at a later date if desired.

The Nichols Ranch Plant is currently engaged in uranium
recovery operations and is processing uranium-bearing wellfield solutions from
Production Area #1 of the Nichols Ranch Wellfield. At the current time,
yellowcake production is occurring at the White Mesa Mill, whereby yellowcake
slurry is shipped by truck from the Nichols Ranch Project to the Mill where it
is dried and packaged in drums as uranium concentrate product. Prior to the
completion of the elution circuit in February 2016, loaded resin was transported
by truck to a third party facility for elution, drying and packaging, under a
toll processing arrangement.

The Nichols Ranch Plant was acquired by the Company on June
18, 2015, through the acquisition of Uranerz. As of December 31, 2015, the total
cost attributable to the Nichols Ranch Plant on the Companys financial
statements was $26.84 million.

The Companys Planned Work

During 2016, we plan to continue header house and wellfield
construction in Production Area #1 of the Nichols Ranch Wellfield, including
header houses #7 and #8. Work on header houses #9 and #10 in Production Area #2
is expected to commence, subject to market conditions. And, we expect to
continue with our permitting efforts in connection with the Jane Dough Property
application.

Wellfield delineation drilling for Header Houses #7 and #8 has
been completed. Wellfield production wells for Header House #7 have been
completed and are currently being connected for a March 2016 start-up. The
addition of this header house is planned to bring another 115 extraction and
injection wells online. The wellfield pattern development and well installation
for Header House #8 is nearly completed. The addition of this header house is
planned to bring another 58 extraction and injection wells online during the
second half of 2016.

We are currently designing a uranium extraction plan for the
Jane Dough Property in conjunction with our license amendment applications,
whereby we would expand extraction operations to the Jane Dough Property before
expanding to the Hank Project. We are presently contemplating that our Jane
Dough Property will have two targeted extraction areas.

The Hank Project, including the permitted but not constructed
Hank Satellite Plant and planned Hank wellfield, is currently licensed as a
satellite uranium extraction and recovery facility, with loaded resin from the
satellite facility, when constructed, expected to be transported by truck to the
Nichols Ranch Plant for elution. Construction activities at the Hank Project
will not commence until market conditions warrant. In the future, we will
consider whether to amend our current license for the Hank Project to include a
pipeline to our Nichols Ranch Plant which would replace or eliminate the
currently permitted satellite ion exchange recovery facility. If market
conditions warrant construction activities at the Hank Project, our extraction
plan for the Hank Property will likewise target two planned extraction areas.
Should market conditions warrant, the Jane Dough and Hank Properties will follow
a similar construction, extraction, and restoration schedule as outlined above
for the Nichols Ranch Wellfield extraction areas.

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Mineral Resource Estimates

BRS prepared an updated NI 43-101 compliant Mineral Resource
estimate for the Nichols Ranch Project project in the Nichols Ranch Technical Report. The updated
Mineral Resource estimate is effective as at January 1, 2015 and is summarized in
the table below. Mineral Resources were estimated using the GT Contour method.
The primary data used in evaluation are equivalent uranium values as quantified
by downhole geophysical logging reported as %eU3O8.
Radiometric equilibrium was evaluated and a disequilibrium factor (DEF) of 1 was
used. The minimum uranium grade included in the estimate was 0.02%
eU3O8. A minimum grade of 0.02% U3O8and GT (grade x thickness) of 0.20 were used in these resource
calculations. Mineral resources are reported at a cutoff of 0.20 GT which is the
cutoff applied at the Nichols Ranch Project. This 0.2 GT cutoff was used in this
evaluation without direct relation to an associated price. The table below
provides a summary of Mineral Resources by classification following CIM
guidelines. There are no Mineral Reserves on the property at this time. BRS
noted that it is not aware of any known environmental, permitting, legal, title,
taxation, socioeconomic, marketing, political, or other relevant factors that
could materially affect the current resource estimate.

Project Total Remaining Measured and Indicated Mineral
      Resources(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)
    Energy Fuels 
    Pounds(2)(,000)Measured Resources
    536
    0.140
    1,503
    1,405Indicated Resources
    2,770
    0.111
    6,171
    5,500Total M&I
    3,306
    0.115
    7,674
    6,905Inferred Resources
    593
    0.100
    1,184
    1,112


(1) Remaining Measured Mineral Resource includes reduction for
production of 272,844 pounds from January 1, 2015 through January 1, 2016. A
total of 82,028 pounds of U3O8 were added to the resource
estimate to reflect the results of drilling in header houses #5 and #7 in 2015.
All numbers are rounded. Mineral Resources that are not reserves under SEC
Industry Guide 7 do not
have demonstrated economic viability.(2) Energy Fuels Pounds represent
100% of Nichols Ranch and Hank; Jane Dough is 100% in part and 81% in part
through the Arkose Mining Venture.

Information shown in the table above differs from the
disclosure requirements of the SEC. See Cautionary Note to U.S. Investors
Concerning Disclosure of Mineral Resources, above.

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The White Mesa Mill



General

The White Mesa Mill is a fully licensed uranium and vanadium
processing facility located in southeastern Utah, approximately six miles south
of the city of Blanding, Utah. It is within trucking distance of our
conventional properties in Utah, Colorado, Arizona and New Mexico, including the
Canyon Project, the Roca Honda Project, the Henry Mountains Complex, the La Sal
Project and the Daneros Project. The Mill is the only fully operational and
licensed conventional uranium mill in the U.S. It is capable of functioning
independently of off-site support except for commercial power from Rocky Mountain
Power and as-needed supplemental water supply from the City of Blanding, Utah,
and the San Juan Water Conservancy District. The White Mesa Mill is a uranium
processing and recovery facility. It is not an underground or open pit
project.

The Mill is licensed to process an average of 2,000 tons of ore
per day and to extract over 8.0 million pounds of 
U3O8 per year. In addition to the conventional circuit,
the Mill has a separate vanadium co-product recovery circuit.

In addition to the Mill processing equipment, which includes
the grinding and leaching circuits, CCD (liquidsolid separation), solvent
extraction, and precipitation and drying circuits, the Mill has several days of
reagent storage for sulfuric acid, ammonia, salt, soda ash, caustic soda,
ammonium sulfate, flocculants, kerosene, amines, and liquefied natural gas.

The on-site infrastructure also includes a stockpile area
capable of storing up to 450,000 tons of mineralized material, and existing
tailings capacity of approximately 3.5 million tons of solids. In addition, the
Mill has approximately 90 acres of evaporation capacity.

Synthetic lined cells are used to contain tailings and
solutions for evaporation. We operate two tailings cells and one or more
evaporation ponds during normal
operations. As each tailings cell is filled, the water is drawn off and pumped
to an evaporation pond and the tailings solids are allowed to dry. As each tailings cell
reaches final capacity, reclamation begins with the placement of interim cover
over the tailings. Additional cells are excavated, and the overburden is used to
reclaim previous cells. In this way, there is an ongoing reclamation process.

50

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In full operation, the Mill employs approximately 150 people.

Alternate Feed Materials

The Mill License (defined below) also gives the Company the
right to process other uranium-bearing materials known as alternate feed
materials pursuant to an Alternate Feed Guidance published by the NRC. Alternate
feed materials are uranium-bearing materials, usually classified as waste
products by the generators of the materials, which can be recycled by the Mill
for the recovery of U3O8. The Mill License does
not permit the processing of uranium-bearing materials that have undergone
enrichment. Requiring a routine amendment to the Mill License for each different
alternate feed material, the Company can process these uranium-bearing materials
and recover uranium, in some cases, at a fraction of the cost of processing
conventionally mined material. In other cases, the generators of the alternate
feed materials are willing to pay a recycling fee to the Company to process
these materials to recover uranium and then dispose of the remaining by-product
in the Mills licensed tailings cells, rather than directly disposing of the
materials at a disposal site. By working with the Company and taking the
recycling approach, the suppliers of alternate feed materials can significantly
reduce their remediation costs, as there are only a limited number of disposal
sites for such materials in the United States. Alternate feed materials are
particularly attractive to Energy Fuels because they carry no associated mining
costs.

Throughout its history, the Mill has received 16 license
amendments, authorizing it to process 19 different alternate feed materials. Of
these amendments, ten have involved the processing of feeds provided by nuclear
fuel cycle facilities and private industry, and one has involved the processing
of material from the United States Department of Energy (DOE). These
eleven feed materials have been relatively high in uranium content and
relatively low in volume. The remaining five amendments have allowed the Mill to
process uranium-bearing soils from former defense sites, known as FUSRAP sites,
which were being remediated by the U.S. Army Corps of Engineers. These materials
are typically relatively low in uranium content but relatively high in volume.

The Mill has a separate circuit for processing certain types of
alternate feed materials, which was built in 2009. This circuit enables the Mill
to process both conventionally mined material and alternate feed materials
simultaneously.

Accessibility, Local Resources, Physiography and
Infrastructure

The Mill is located in central San Juan County, Utah,
approximately six miles (9.5 km) south of the city of Blanding. It can be
reached by taking a private road for approximately 0.5 miles west of U.S.
Highway 191.

The climate of southeastern Utah is classified as dry to arid
continental. Although varying somewhat with elevation and terrain, the climate
in the vicinity of the Mill can be considered as semi-arid with normal annual
precipitation of about 13.4 inches. The weather in the Blanding area is typified
by warm summers and cold winters. The mean annual temperature in Blanding is
about 50° (F). Winds are usually light to moderate in the area during all
seasons, although occasional stronger winds may occur in the late winter and
spring.

The Mill site is located on a gently sloping mesa that, from
the air, appears similar to a peninsula, as it is surrounded by steep canyons
and washes and is connected to the Abajo Mountains to the north by a narrow neck
of land. On the mesa, the topography is relatively flat, sloping at less than
one (1) percent to the south and nearly horizontal from east to west.

The natural vegetation presently occurring within a 25-mile
(40-km) radius of the Mill site is very similar to that of the region,
characterized by pinyon-juniper woodland intergrading with big sagebrush
(Artemisia tridentata) communities.

Off-site infrastructure includes paved highway access from U.S.
Highway 191, and rights-of-way for commercial power and a water supply pipeline
from Recapture Reservoir, which brings up to 1,000 acre-feet of water per year
to the Mill site. The Mill also has four deep (2,000+ foot) water supply wells
which are available to supply process water during normal operations.

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Ownership

The White Mesa Mill is located on 4,816 acres of private land
owned in fee by Energy Fuels. This land is located in Township 37S and 38S Range
22E Salt Lake Principal Meridian. Energy Fuels also holds 253 acres of mill site
claims and a 320 acre Utah state lease. No facilities are planned on the mill
site claims or leased land, which are used as a buffer to the operations.

All operations authorized by the Mills License are conducted
within the confines of the existing site boundary. The milling facility
currently occupies approximately 50 acres and the current tailings disposal
cells encompass another 250 acres.

Permitting and Licensing

The White Mesa Mill holds a Radioactive Material License
through the State of Utah (the Mill License). Uranium milling in the
U.S. is primarily regulated by the NRC pursuant to the Atomic Energy Act of
1954, as amended. The NRCs primary function is to ensure the protection of
employees, the public and the environment from radioactive materials, and it
also regulates most aspects of the uranium recovery process. The NRC regulations
pertaining to uranium recovery facilities are codified in Title 10 of the Code
of Federal Regulations. These regulations also apply to our ISR facilities in
Wyoming.

On August 16, 2004, the State of Utah became an Agreement State
for the regulation of uranium mills. This means that the primary regulator for
the White Mesa Mill is UDEQ rather than the NRC. At that time, the Source
Material License, which was previously issued and regulated by the NRC, was
transferred to the State and became a Radioactive Materials License. The State
of Utah incorporates, through its own regulations or by reference, all aspects
of Title 10 pertaining to uranium recovery facilities. The Mill License was due
for renewal on March 31, 2007. Energy Fuels predecessor timely submitted its
application for renewal of the license on February 28, 2007. A draft renewal
license was published for comment by UDEQ in the 4thquarter of 2011. UDEQ is currently in the process of
reviewing the public comments and performing additional environmental reviews.
It is expected that UDEQ will re-publish the license for further public comment
in 2016. Energy Fuels expects that the renewed license will be issued by UDEQ by the end
of 2016. During the period that the State is reviewing the license renewal
application, the Mill is authorized to operate under its existing Radioactive
Materials License. The Mills license was initially issued in 1980 and was
renewed in 1987 and 1997.

When the State of Utah became an Agreement State, it required
that a Groundwater Discharge Permit (GWDP) be put in place for the
White Mesa Mill. The GWDP is required for all similar facilities in the State of
Utah, and implements the State groundwater regulations to the Mill site. The
State of Utah requires that every operating uranium mill have a GWDP, regardless
of whether or not the facility discharges to groundwater. The GWDP for the Mill
was finalized and implemented in March 2005. The GWDP required that the Mill add
over 40 additional monitoring parameters and 15 additional monitoring wells at
the site. The GWDP came up for renewal in 2010, at which time an application for
renewal was timely submitted. The renewal application is currently under review
by UDEQ. During the review period the Mill can continue to
operate under its existing GWDP. The White Mesa Mill also maintains a permit for
air emissions with the UDEQ, Division of Air Quality.

The White Mesa Mill is subject to decommissioning liabilities.
Energy Fuels, as part of the Mill License, is required to annually review its
estimate for the decommissioning of the White Mesa Mill site and submit it to
UDEQ for approval. The estimate of closure costs for the Mill is $22.1 million
as of December 31, 2015, and financial assurances are in place for the
total amount. 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.

History

The Mill was originally constructed and owned by Energy Fuels
Nuclear, Inc. (EFN) and its affiliates (no relation to the Company). It
was licensed by the NRC and commenced operations in June 1980. In 1984, EFN
transferred a 70% interest in the Mill to UMETCO Minerals Corp., a subsidiary of
Union Carbide Corporation (UMETCO). UMETCO became the operator of the
Mill in 1984 and continued to be the operator until 1994, at which time it
transferred its interest in the Mill back to EFN and its affiliates. The Mill
was acquired by Denison Mines Corp. (Denison), then named International
Uranium Corporation (IUC) and its affiliates in 1997, and was operated
by Denison until it was acquired by the Company in June 2012. From the original
commissioning in 1980 through December 31, 2015, the Mill has recovered a total
of approximately 36 million pounds of U3O8 and 46
millionpounds of vanadium.

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In late 2006, Denison began a program to refurbish the Mill.
The refurbishment program included the purchase of mobile equipment, restoration
of the vanadium roasting, fusion and packaging circuits, replacement of major
pumps and component drives, modernization of the Mills instrumentation and
process control systems, and completion of relining tailings Cell 4A. The total
cost of the refurbishment program was approximately $31.0 million and was
completed in 2008.

The White Mesa Mill has historically operated on a campaign
basis. In 2008, the Mill began processing uranium/vanadium conventional
material, extracting uranium concentrate in the form of
U3O8, and vanadium in the form of
V2O5. Mineral processing continued through the end of
March 2009, at which time maintenance activities were performed at the Mill. Mineral
processing recommenced near the end of April 2009, but was discontinued due to a
decline in uranium prices at the time. The Mill began mineral processing again
in March 2010 and continued through June 2011. Conventional processing
recommenced in November 2011 and continued until early March 2012, at which time
it ceased for routine maintenance. Conventional mineral processing recommenced
at the Mill in August 2012 and continued until early June 2013. Mineral
processing began again in May 2014 and continued through August 2014. The
alternate feed circuit processed materials from January through December 2014,
and continued processing alternate feed materials through December 2015.

Energy Fuels acquired the Mill from Denison Mines Corp. on June
29, 2012. All mineral processing after that date has been for the account of
Energy Fuels. Mineral processing at the Mill over the past five years is shown
below. (Note, only mineral processing since June 30, 2012 has been for the
account of Energy Fuels).(1)

Project or Source
    2015
    2014
    2013
    2012(1)
    2011(1)Alternate Feed Materials(2)Tons
    1,243
    1,154
    3,492
    6,998
    12,040Ave % U3O8
    9.21%
    16.94%
    5.03%
    3.09%
    0.83%Pounds
      U3O8(x1,000)
    229(3)
    391(3)
    351
    433
    200Tailing Solution Recycle and In-Circuit
      Material(4)Pounds
      U3O8(x1,000)
    67(4)
    ---
    ---
    ---
    ---Conventional Feed MaterialsTons
    ---
    49,268
    126,342
    125,485
    172,000Ave % U3O8
    ---
    0.56%
    0.26%
    0.33%
    0.24%Pounds U3O8 (x1,000)
    ---
    552
    655
    836
    811Total Pounds U3O8 Recovered (x1,000)
    296
    943
    1,007
    1,269
    1,011Total Pounds V2O5 Recovered (x1,000)
    ---
    ---
    1,303
    235
    1,290


Notes:

| | (1) | Mineralized material is shown as being processed and
      pounds recovered during the year in which the materials were processed at
      the White Mesa Mill or at the Nichols Ranch Plant, which is not
      necessarily the year in which the materials were extracted from the
      project facilities. It should also be noted that production to June 29,
      2012 and all of 2011 pre-dates the Companys ownership of the  US
      Mining Division, and was therefore for the account of the previous
      owner.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | All alternate feed materials were processed at the White
      Mesa Mill. A number of different alternate feed materials were processed
      during the period  2011  2015. The table shows the average uranium
      grades and the total pounds recovered from all alternate feed materials
      processed at the Mill during each of the years in that period.                                                                                                                                                            
| | (3) | The 229,000 pounds recovered in 2015 includes 72,281
      pounds recovered for the accounts of third parties, and the 391,000 pounds
      recovered in 2014 includes 85,000 pounds recovered for the accounts of
      third parties.                                                                                                                                                                                                                                                                                         
| | (4) | Pounds contained in tailings solutions containing
      previously unrecovered uranium, together with in-circuit mineralized
      material from previous conventional ore processing, were recovered by
      processing alternate feed materials at the White Mesa Mill, though tons
      and grade are not available because it cannot be tied to any specific
      source. Of these 67,000 pounds, 25,000 pounds are attributed to in-circuit
      material from previous conventional ore processing.                   

Present Condition of the Property

Planned Operations and Maintenance

The White Mesa Mill processed conventional material from June
to mid-August 2014. The alternate feed circuit was operating throughout 2014 and
continued through  2015. The White Mesa Mill is expected to begin processing conventional ore again in August 2016 until October
2016. The alternate feed circuit is expected to process materials until July
2016. The Mill operations registered zero lost time accidents in 2015.

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The Mill is conducting certain deferred maintenance activities,
including the installation of five new replacement leach tanks which must be
completed before conventional mineral processing may occur in the future.

Environmental Matters

Prior to Energy Fuels acquisition of the Mill from Denison,
chloroform in the shallow aquifer at the White Mesa Mill site was discovered.
The chloroform 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, 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 affected water from the groundwater to the Mills tailings
system. This action enabled Energy Fuels to begin cleanup of the affected areas
and to take a further step towards resolution of this outstanding issue. Pumping
from the wells continued in 2015. On September 14, 2015, the State of Utah
approved a long-term Corrective Action Plan (CAP) for cleanup of the
chloroform, which involves continued pumping of the affected water to the Mills
tailings system. While the investigations to date indicate that this chloroform
appears to be contained in a manageable area, the scope and costs of final
remediation have not yet been determined and could be significant.

Prior to Energy Fuels acquisition of the Mill from Denison,
elevated concentrations of nitrate and chloride were observed in some of the
monitoring wells at the White Mesa Mill site in 2008, 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 was determined that there are site
conditions that make it difficult to ascertain the source(s) of contamination at
the site, and that it was not possible at that time to determine the source(s),
causes(s), attribution, magnitude(s) of contribution, and proportion(s) of the
local nitrate and chloride in groundwater. For those reasons, UDEQ decided that
it could not 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 CAP, 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 a draft CAP for remediation of the contamination to UDEQ in November
2011. The CAP proposed a program of pumping the nitrate contaminated groundwater
to the Mills tailings cells, similar to the chloroform remedial program. UDEQ
approved the CAP on December 12, 2012. In accordance with the CAP, in 2013 the
Company commenced pumping nitrate/chloride contaminated water from four
monitoring wells for use in Mill processing or discharge into the Mills process
or tailings cells. 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.

During 2011, 2012, and 2013, the White Mesa Mill reported
consecutive exceedances of groundwater compliance limits (GWCLs) under
the Mills 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.
Source Assessment Reports were submitted in 2012 and 2013 addressing each
exceedance and the decreasing trends in pH at the site. UDEQ has accepted the
Source Assessment Reports, 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 in the GWDP to account for these background
influences, which would put those constituents, including pH at the site, back
into compliance.

Total Cost of Project

The White Mesa Mill was acquired by the Company in June 2012,
through the acquisition of the US Mining Division from Denison. The cost of the
White Mesa Mill has been fully impaired, and as of December 31, 2015, the total
cost attributable to the White Mesa Mill and its associated equipment on the
financial statements of the Company was nil.

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The Companys Planned Work

The Company intends to continue the current Mill processing
campaign into late 2016 to process (i) stockpiled Pinenut material that was
mined in 2014 and 2015 and (ii) alternate feed materials.

The Company is currently installing five new replacement leach
tanks, which are required for conventional processing. Following completion of the campaign to process Pinenut
mineralized materials and alternate feed materials at the White Mesa Mill, the
Company intends to place the Mill on standby and maintain it in a state of
readiness for the purpose of restarting mineral processing operations as
available material and/or market conditions may warrant.  While on standby, the Mill will dry and package
yellowcake from the Nichols Ranch Plant.

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The Canyon Project



Except as noted, the following technical and scientific
description of the Canyon Project is based on a technical report titled
Technical Report on the Arizona Strip Uranium Project, Arizona, U.S.A., dated
June 27, 2012, prepared by Thomas C. Pool, P.E and David A. Ross, M.Sc., P.Geo.
of RPA in accordance with NI 43-101 (the Arizona Strip Technical
Report). Each of the authors of the Arizona Strip Technical Report are a
qualified person and is independent of the Company within the meaning of NI
43-101. The Arizona Strip Technical Report is available on SEDAR at
www.sedar.com. The Canyon Project does not have known reserves, and is
therefore considered under SEC Industry Guide 7 definitions to be exploratory in
nature, despite currently ongoing construction and shaft sinking activities.

Property Description and Location

The Canyon Project is a partially constructed underground
uranium project with: a headframe, a hoist, a compressor and a partially sunk
shaft. The site is located south of the Grand Canyon National Park, in Sections
19 and 20, T29N, R3E, Coconino County, Arizona, 153 miles north of Phoenix and
six miles south of Tusayan, Arizona in the Kaibab National Forest. The Canyon
Project was acquired by Energy Fuels in its June 2012 acquisition of Denisons
US Mining Division.

The Canyon Project is located in the Arizona Strip mining
district. The Arizona Strip is an area largely bounded on the north by the
Arizona/Utah state line; on the east by the Colorado River and Marble Canyon; on
the west by the Grand Wash Cliffs; and on the south by a midpoint between the
city of Flagstaff and the Grand Canyon. The area encompasses approximately
13,000 square miles. Uranium-bearing material from the Arizona Strip mines is
hauled by truck to the White Mesa Mill where it is processed. The Companys
Arizona 1, Pinenut and EZ Projects are located north of the Grand Canyon. The
Canyon Project, along with the Wate Project, are located south of the Grand
Canyon. The Canyon Project is 325 road miles from the Mill.

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Accessibility, Local Resources, Physiography and
Infrastructure

The site is accessible by State highway and an unsurfaced U.S.
Forest Service road.

Climate in northern Arizona is semi-arid, with cold winters and
hot summers. January temperatures range from about 7° F to 57° F and July
temperatures range from 52° F to 97° F. Annual precipitation, mostly in the form
of rain but some snow, is about 12 inches. Vegetation on the plateaus is
primarily open piñon juniper woodland and shrubs. Mining operations can be
conducted on a year around basis.

Electrical power is provided directly to the site by power line
from the local power utility.

Ownership

The Canyon Project is held by Energy Fuels on nine unpatented
claims located on land managed by the USFS. There is a 3.5% yellowcake royalty
on the Canyon property due to a prior owner of the claims.

Holding costs for the Canyon Project are minimal and consist
entirely of annual fees for unpatented mining claims ($155 per claim per year)
and county filing fees (approximately $10 per claim per year). Unpatented mining
claims expire annually, but are subject to indefinite annual renewal by filing
appropriate documents and paying the fees described above. In addition, holders
of unpatented mining claims on USFS lands are generally granted surface access
by the USFS to conduct mineral exploration and mining activities.

Permitting and Licensing

The Canyon Project is located on public lands managed by the
USFS and has an approved PO with the USFS. In September 2009, the groundwater
General Permit was received for the storm water storage ponds. An Air Quality
Permit was issued by ADEQ in March 2011, which is up for renewal in 2016.
Although the Canyon Project is estimated to contain 82,800 tons of mineralized
material, which is less than the 100,000 tons required to trigger the need for a
National Emissions Standard for Hazardous Air Pollutants (NESHAPs) approval
under the U.S. Clean Air Act, the Company received EPAs approval of a voluntary NESHAPs
application for the Canyon Project in September of 2015, in order to be prepared
in the event the total tons of mineralized material over the life of the project
were to exceed 100,000 tons.

Development of uranium-bearing breccia pipes of the
Arizona Strip requires minimal surface disturbance, typically less than 20
acres, and has little if any impact on groundwater since most of the mines are
relatively dry. The overall environmental impact is small. Nevertheless, the
Grand Canyon area is environmentally sensitive in many ways and the permitting,
development, and operation of a uranium extraction facility in this area is a contentious
issue. In 2009, as described below, over one million acres of federal land were
withdrawn from mineral location, subject to valid existing rights. Currently,
there are proposals being considered that would create a National Monument in
areas near the Grand Canyon National Park, including the land for the Canyon
Project, subject to valid existing rights. Environmental liabilities at the Canyon
Project are bonded at their
total expected reclamation cost.

Geological Setting

Parts of two distinct physiographic provinces are found within
Arizona: the Basin and Range province in the southern and western edge of the
state, and the Colorado Plateau province in most of northern and central
Arizona. The Arizona Strip lies within the Colorado Plateau province.

Surface exposures within the Arizona Strip reveal sedimentary
and volcanic rocks ranging in age from upper Paleozoic to Quaternary; the area
is largely underlain by Mississippian through Triassic sedimentary rocks.
However, exposed within the Grand Canyon are older rocks reaching Precambrian in
age.

Paleozoic sedimentary rocks of northern Arizona are host to
thousands of breccia pipes. These deposits are known to extend from the
Mississippian Redwall Limestone to the Triassic Chinle Formation, which makes
about 4,000 feet of section. However, because of erosion and other factors, no
single deposit has been observed cutting through the entire section. No deposit
is known to occur above the Chinle Formation or below the Redwall Limestone.

Breccia pipes within the Arizona Strip are vertical or near
vertical, circular to elliptical bodies of broken rock. Broken rock is comprised
of slabs and rotated angular blocks and fragments of surrounding and
stratigraphically higher formations. Surrounding the blocks and slabs making up
the breccia is a matrix of fine material comprised of surrounding and overlying rock from various formations. The
matrix has been cemented by silicification and calcification for the most
part.

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Breccia pipes are typically comprised of three interrelated
features: a basinal or structurally shallow depression at surface (designated by
some as a collapse cone); a breccia pipe which underlies the structural
depression; and annular fracture rings which occur outside of, but at the margin
of the pipes. Annular fracture rings are commonly, but not always, mineralized.
The structural depression may be up to 0.5 miles or more in diameter, whereas
the breccia pipe diameters range up to about 600 feet; the normal range is 200
feet to 300 feet.

Mineralized breccia pipes found to date appear to occur in
clusters or trends. Spacing between breccia pipes ranges from hundreds of feet
within a cluster to several miles within a trend. Pipe location may have been
controlled by deep seated faults, but karstification of the Redwall Limestone in
Mississippian and Permian times is considered to have initiated formation of the
numerous and widespread breccia pipes in the region.

At the Canyon deposit, the surface expression of the pipe is a
broad shallow depression in the Permian Kaibab Formation. The pipe is
essentially vertical with an average diameter of less than 200 feet, but it is
considerably narrower through the Coconino and Hermit horizons (80 feet). The
cross sectional area is probably between 20,000 and 25,000 square feet. The pipe
extends for at least 2,300 feet from the Toroweap limestone to the upper Redwall
horizons. The ultimate depth of the deposit is unknown.

Mineralization extends over about 1,700 vertical feet, with
higher grade mineralization found mainly in the Coconino, Hermit, and Esplanade
horizons and at the margins of the pipe in fracture zones. Sulphide zones are
found scattered throughout the pipe but are especially concentrated (sulphide
cap) near the Toroweap Coconino contact, where the cap averages 20 feet thick
and consists of pyrite and bravoite, an iron-nickel sulphide. The mineralized
assemblage consists of uranium-pyrite-hematite with massive copper sulphide
mineralization common in and near the higher grade zone. The strongest
mineralization appears to occur in the lower Hermit-upper Esplanade horizons in
an annular fracture zone.

History

Uranium exploration and mining of breccia pipe uranium deposits
started in 1951 when a geologist employed by the U.S. Geological Survey noted
uranium ore on the dump of an old copper prospect on the South Rim of the Grand
Canyon of Northern Arizona. The prospect was inside the Grand Canyon National
Park, but on fee land that predated the park. A mining firm acquired the
prospect and mined this significant high grade uranium deposit, called the
Orphan Mine. By the time mining ended in the early 1960s, 4.26 million pounds of
U3O8 and some minoramounts of copper and silver had been
produced.

After the discovery of the first deposit in the 1950s, an
extensive search for other deposits was made by the government and industry, but
only a few low grade prospects were found. Exploration started again in the
early 1970s. In the mid-1970s, Western Nuclear Inc. (Western Nuclear)
acquired the Hack Canyon prospect located about 25 miles north of the Grand
Canyon and found high grade uranium mineralization offsetting an old shallow
copper/uranium site. In the next few years, a second deposit was found
approximately one mile away. EFN acquired the Hack Canyon property from Western
Nuclear in December 1980. Construction started promptly, and the Hack Canyon
mine was in production by the end of 1981.

The Canyon deposit is located on mining claims that EFN
acquired from Gulf Mineral Resources Company (Gulf) in 1982. Gulf
drilled eight exploration holes at the site from 1978 through May 1982 but found
only low-grade uranium in this pipe. Additional drilling completed by EFN in
1983 identified a major deposit. EFN drilled a further 36 holes from May 1983
through April 1985 to delineate the uranium mineralization and to determine
placement of the  shaft and water supply well. Additional drilling of six
holes was completed in 1994. Construction at the site was discontinued as a
result of low uranium prices at that time.

EFN identified and investigated more than 4,000 circular
features in northern Arizona. About 110 of the most prospective features were
explored by deep drilling, and approximately 50% of those drilled were shown to
contain some uranium mineralization. Ultimately, nine deposits were deemed
worthy of development. Total mine production from the EFN breccia pipes from
1980 through 1991 was approximately 19.1million pounds
U3O8 at an average grade of just over 0.60%
U3O8.

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Most of the EFN assets were acquired by Denison (then named IUC) in 1997 and by the Company in June 2012 upon acquisition of the US Mining
Division. Since that time, Denison and then Energy Fuels has maintained
ownership of the Canyon Project.

Denison did not carry out any exploration on the Canyon Project
since its acquisition of the project in 1997, nor has the Company to
date. Exploration for breccia pipes in northern Arizona typically begins with a
search for surface expressions of circular features. This search was aided by
geologic mapping, Landsat aerial photography, thermal infrared imagery,
geochemical testing, and certain geophysical methods such as resistivity, Very
Low Frequency (VLF), and time domain electromagnetics. Other techniques tested
included: geobotany, microbiology, and biogeochemistry. All of these methods
were utilized to identify surface expressions of breccia pipes. The key element
of the process was to zero in on the throat of the pipe as a locus for drilling
from the surface since the throat is usually associated directly with the center
of the collapse.

Mineralization

In the breccia pipe deposits of the Arizona Strip, uranium
occurs largely as blebs, streaks, small veins, and fine disseminations of
uraninite/pitchblende. Mineralization is mainly confined to matrix material, but
may extend into clasts and larger breccia fragments, particularly where these
fragments are of Coconino sandstone. An extensive suite of anomalous elements
has also been reported, including: silver, arsenic, barium, cadmium, cobalt,
chromium, cesium, copper, mercury, molybdenum, nickel, lead, antimony, selenium,
strontium, vanadium, and zinc. In addition, many of the rare earth elements are
consistently enriched in uranium-mineralized samples. Within some breccia pipes,
copper occurs in sufficient concentrations to be potentially economic. Silver is
almost always anomalously high and some of the pipes carry potentially economic
grades. Within many pipes, there is a definite mineralogical zoning in and
around the uranium mineralization.

These breccia pipes are surrounded by bleached zones where
unaltered red sediments contrast sharply with grey-green bleached material. Age
dating and disequilibrium determinations indicate that remobilization of uranium
has occurred. Uranium concentrations in the upper levels of a pipe tend to be in
equilibrium. With depth, disequilibrium in the deposits increases in favour of
the chemical assays.

Uranium mineralization at the Canyon Project is concentrated in
three stratigraphic levels: Coconino, Hermit/Esplanade, and a lower zone.
Mineralization extends vertically from a depth of 600 feet to over 2,100 feet.
Intercepts range widely up to several tens of feet with grades in excess of
1.00% eU3O8.Twenty-two drill holes from surface
encountered uranium mineralization averaging 100 feet of 0.45%
eU3O8.

Present Condition of the Property and Work Completed to Date

At the Canyon Project, all surface facilities are in place, and
construction of the shaft is underway. As of March 7, 2016 shaft sinking had
progressed to 640 feet below ground surface.

The Canyon Project was acquired by the Company in June 2012,
through the acquisition of the US Mining Division from Denison. The cost of the
Canyon Project has been fully impaired, and as of December 31, 2015, the total
cost attributable to the Canyon Project and its associated equipment on the
financial statements of the Company was nil.

The Companys Planned Work

We intend to continue shaft-sinking at the Canyon Project
through October, 2016, at which time the shaft is expected to be sunk to its
planned depth of 1,470 feet below surface. Once the shaft depth approaches the
mineralized zone, at a depth of approximately 1,000 feet below ground surface,
we plan to complete additional underground exploration drilling to further
evaluate the deposit. We expect the shaft to have been sunk to this 1,000 foot
depth and the underground drilling program to have commenced by June 2016. The
timing of our plans to extract and process mineralized materials from this
project will be based on the results of this additional evaluation work, along
with market conditions, available financing and sales requirements.

Mineral Resource Estimate

Initial Mineral Resource estimates were prepared for the Canyon
deposit using historical drill hole data provided by Energy Fuels. RPA
interpreted a set of cross sections and plan views to construct 3-D grade-shell
wireframe models at 0.2% eU3O8. Variogram parameters were
interpreted and eU3O8 grades were estimated in the block
model usingkriging. The grade-shell wireframes were used to constrain the grade
interpolation. All blocks within the 0.2% eU3O8 grade-shell wireframes, regardless of grade, were included in the Mineral
Resource estimate.

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There are no Mineral Reserves estimated at the Canyon deposit
at this time. Due to difficulties encountered in validating historical data, all
Mineral Resources were classified as Inferred Mineral Resources. In June 2012,
RPA estimated the Inferred Mineral Resources for Canyon as shown in the table
below.

Canyon Inferred Mineral Resource Estimates (1)

Tons (,000)
    Grade (%)
      eU3O8(2)(3)
    Contained
      eU3O8
    (,000 lbs)Canyon
    82.5
    0.98
    1,629


Notes:

| | (1) | The Mineral Resource estimates comply with the
      requirements of NI 43-101 and the classifications comply with CIM
      definition standards and do not represent reserves under SEC Industry
      Guide 7. Mineral resources that are not  reserves do not have
      demonstrated economic viability. See Cautionary Note to U.S. Investors Concerning
      Disclosure of Mineral Resources,above.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | Interval grades were converted from the gamma log data
      and are therefore equivalent U3O8 (eU3O8).                                                                                                                                                                                                                                                                                                      
| | (3) | Grades higher than 10% eU3O8 were
      cut to 10% at the Canyon Project for resource
estimating.                                                                                                                                                                                                                                                                                                            

In its feasibility studies of the various Arizona Strip breccia
pipes compiled during the 1980s and 1990s, EFN typically used a cut-off grade of
0.15% U3O8. We concluded that a reasonable cut-off grade
for long term sustainable market conditions would be approximately 0.20%
U3O8. This cut-off grade was applied by RPA to theCanyon
breccia pipe deposit. RPA applied a tonnage factor of 13 ft.3which
had been used in the historical resources and substantiated by Hack Canyon
mines production data.

Mineral Resource and Reserve Update

There have not been any updates to the Mineral Resources and
Mineral Reserves since the date of the Arizona Strip Technical Report.

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The Roca Honda Project



Except as noted concerning land tenure and permitting efforts,
the following technical and scientific description of the Roca Honda Project is
based on a technical report titled "Technical Report on the Roca Honda Project,
McKinley County, New Mexico, U.S.A." dated February 27, 2015, prepared by Barton
G. Stone, C.P.G., Robert Michaud, P.Eng., Stuart E. Collins, P.E., and Mark B.
Mathisen, C.P.G., all of Roscoe Postle Associates (RPA) in accordance
with NI 43-101 (the Roca Honda Technical Report). The Roca Honda
Technical Report includes an updated mineral resource estimate and the results
of a PEA for the uranium resources outlined to date at the Roca Honda Project in
New Mexico. Each of the authors of the Roca Honda Technical Report is a
qualified person and all but one is independent of the Company within the
meaning of NI 43-101. Harold R. Roberts, P.E., Executive Vice President,
Conventional Operations of the Company is a coauthor of the PEA; however, the
independent authors of the Report have assumed overall responsibility for all
items of the technical report, and the Report is therefore an independent
technical report under NI 43-101. The Roca Honda Technical Report is available
on SEDAR at www.sedar.comand onEDGAR atwww.sec.gov. The
Roca Honda Project does not have known reserves, and is therefore considered
under SEC Industry Guide 7 definitions to be exploratory in nature, despite
currently ongoing permitting activities.

We acquired the Roca Honda Project on August 29, 2013 as a
result of our acquisition of Strathmore.

Property Description and Location

The Roca Honda Project is an underground uranium project that
is being permitted by the Companys 60% subsidiary, Roca Honda Resources, LLC
(RHR). The Roca Honda Project was acquired on August 29, 2013, as a result of
the acquisition of Strathmore Minerals Corp. The Roca Honda Project is located
approximately three miles northwest of the community of San Mateo, New Mexico,
near the southern boundary of McKinley County and north of the Cibola County
boundary, and approximately 22 miles by road northeast of Grants, New Mexico. The property is located in the east part of the
Ambrosia Lake subdistrict of the Grants Mineral Belt in northwest New Mexico and
comprises nearly all of Sections 9, 10, and a narrow strip of Section 11, and a
New Mexico State Lease, consisting of Section 16, all in Township 13 North 
Range 8 West (T13N-R8W), New Mexico Principal Meridian. Mineralized material
from the Roca Honda Project will be shipped by highway truck to the White Mesa
Mill, where it will be processed for the recovery of uranium. The Roca Honda
Project does not have known reserves, and is therefore considered under SEC
Industry Guide 7 definitions to be exploratory in nature.

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Accessibility, Climate, Local Resources and Physiography

The Roca Honda Project is currently accessed by public roads,
highways and across private land held by Fernandez Company, Ltd.
(Fernandez). It is located approximately 17 air miles and 22 road miles
northeast of Grants, New Mexico. The southern portion of the project, on Section
16, can be reached by traveling north from Milan on New Mexico State Highway 605
toward the town of San Mateo and then north on a public gravel road. Access from
Highway 605 onto Sections 20, 17 and 16 requires a surface use agreement with
the surface owner, Fernandez. We believe we acquired surface access rights to
those Sections when we acquired Section 17 in 2015 (See Acquisition of
Properties Adjacent to the RHR Joint Venture Properties,below). We are
currently in discussions with Fernandez to determine what, if any, additional
surface access rights are required and to negotiate a comprehensive updated
access and right of way agreement for all Roca Honda property within the
proposed permit area to replace all existing surface use agreements. Proof of
right-of-entry will be required before mine construction can commence.

The north part of the project can be reached by traveling 23.5
miles from Milan, New Mexico, on paved public Highway 605, and then west on US
Forest Service roads to the southeast corner of Section 10. There are numerous
drill roads that provide access to different portions of Sections 9 and 10, many
of which will require maintenance. Old drill roads were previously established
across the property, and an electrical line transects the northern half of
Section 16 in the project area. The line continues on the west side of the
project area into Section 17, where it terminates, and on the east side of
Section 16 through the northwest quarter of Section 15 and along the southern
section boundary of Section 10. No milling operations are expected to occur on
the site.

The climate in the Roca Honda Project area may be classified as
arid to semi-arid continental, characterized by cool, dry winters, and warm, dry
summers. On average, the Roca Honda property receives approximately 11 inches of
precipitation annually, most of which occurs during thunderstorms in July and
August. Grants, New Mexico has an annual average temperature of 50°F, with an
average summer high of 87°F and low of 52°F, and average winter high of 47°F and
low of 18°F. Year-round operations are expected.

The community of Grants, New Mexico, located in Cibola County,
is the largest community near the Roca Honda Project. As of the 2010 census,
there are 8,772 people residing in Grants, where supplies can be obtained and
personnel experienced in  underground mining, construction and
mineral processing are available.

The Roca Honda Project area is sparsely populated, rural and
largely undeveloped. The predominant land uses include low density grazing and
cultivation, and recreational activities such as hiking, sightseeing, and
seasonal hunting. The Roca Honda property has moderately rough topography in
Sections 9 and 10 and consists of shaly slopes below ledge-forming sandstone
beds, as mesas, that dip 7° to 11° northeast. Elevations range from 7,100 feet
to 7,800 feet. Section 9 consists mostly of steep slopes in the west and south,
with a large sandstone mesa in the north central part. Section 10 consists
mostly of the dip-slope of a sandstone bed that dips from 8° to 11° east.
Section 16 has less topographic relief, with elevations ranging from 7,100 to
7,300 feet and easterly dipping slopes. Vegetation in the Roca Honda Project
area consists of grasses, piñon pine and juniper trees.

Ownership

The Roca Honda Project is held by RHR, which is jointly owned
by Energy Fuels wholly- owned subsidiary Strathmore Resources, (US) Ltd. (60%)
and Sumitomos subsidiaries SC Clean Energy and Summit New Energy Holding, LLC
(40%). RHR was established on July 26, 2007, when Strathmore formed a limited
liability company with Sumitomo and transferred the property to RHR. On March 4,
2016 we entered into a non-binding letter of intent with Sumitomo to acquire its
40% interest in RHR. See General Development of the Business  Subsequent
Events under Item 1 above.

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The Roca Honda Project covers an area of 1,886.5 acres, and
includes 63 unpatented lode mining claims in Sections 9 and 10, and one
adjoining New Mexico State General Mining Lease in Section 16. The mining claims
also extend onto a 9.4 acre narrow strip of Section 11.

The State Mining Lease (No. HG-0036-002) issued by the New
Mexico State Land Office for Section 16 covers an area of 638 acres. The surface
of Section 16 is leased to Fernandez as rangeland for grazing. The area covered
by the Fernandez lease is also referred to as Lee Ranch. The Mining Lease has
a primary, secondary, tertiary, and quaternary term, each with rentals to be
paid in advance, and will not expire until December 15, 2030. It can be held for
the next three years (primary term) by paying only $1.00 per acre annually.

There is a New Mexico mining royalty payable on the value of
mineral extraction for New Mexico state leases. The royalty is based upon the
operating cash flow less a development allowance, depreciation, and a processing
allowance. New Mexico mining and private royalties on value of minerals
extracted are shown below:

- Section 9 Gross Royalty (1%); and
- Section 16 New Mexico State Lease Royalty (5%).

Under current access agreements, a gross royalty of 1% is payable to the
surface owner.

Permitting and Licensing

The Roca Honda Project is at an advanced stage of permitting.
The Draft EIS was completed by the USFS in February 2013, and the Company
expects the Final EIS to be published in late 2017 or 2018. The USFS is
currently preparing a Supplemental EIS to address a new discharge pipeline
alternative and expansion of the Roca Honda Project into Section 17. Other major
permits required for the Roca Honda Project include a Permit to Mine to be
issued by the New Mexico Mining and Minerals Division, a Discharge Permit issued
by the New Mexico Environment Department, and a Mine Dewatering Permit issued by
the New Mexico State Engineers Office. The Mine Dewatering Permit was approved
in December 2013 but appealed by the Acoma Pueblo in January 2014. RHR
subsequently proposed a new alternative for discharging treated mine water that
would benefit a number of downstream users including the Acoma Pueblo. As a
result, the Acoma Pueblo agreed to withdraw the dewatering permit appeal in
March 2015.

The two other major permits are in the agency review stage with
a draft Discharge Permit expected in late 2016, and the Permit to Mine expected
in late 2017 or 2018 following approval of the final FEIS. Permit approvals from the
U.S. Army Corps of Engineers and the U.S. Environmental Protection Agency are
also required for discharge of treated mine water associated with mine
activities. Applications for these two permits are also presently undergoing
agency review.

As the project has not yet been developed or operated, we are
not aware of any environmental liabilities of any significance.

No permitting is required to start milling the Roca Honda
Project material at the White Mesa Mill. The White Mesa Mill is fully permitted
with the State of Utah, and has all the necessary operating licenses for a
conventional uranium mill. As additional tailings storage capacity will
eventually be required at the Mill over the life of the mine, an Amendment to the White Mesa
Mills Radioactive Materials License issued by the Utah Division of Radiation
Control will be required in due course to construct the next tailing cells.

Geological Setting

The Roca Honda Project area is located in the southeast part of
the Ambrosia Lake subdistrict of the Grants uranium district and is near the
boundary between the Chaco slope and the Acoma sag tectonic features. This
subdistrict is in the southeastern part of the Colorado Plateau physiographic
province and is mostly on the south flank (referred to as the Chaco slope) of
the San Juan Basin.

Rocks exposed in the Ambrosia Lake subdistrict of the Grants
Mineral Belt, which includes the Roca Honda Project area, comprise marine and
non-marine sediments of Late Cretaceous age, unconformably overlying the
uranium-bearing Upper Jurassic Morrison Formation. The uppermost sequence of
conformable strata consists of the Mesaverde Group, Mancos Shale, and Dakota
Sandstone. All rocks that outcrop at the Roca Honda Project area are of Late
Cretaceous age.

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The uranium found in the Roca Honda Project area is contained
within five sandstone units of the Westwater Canyon Member. Zones of
mineralization vary from approximately one foot to 32 ft. thick, 100 ft. to 600
ft. wide, and 200 ft. to 2,000 ft. long. Uranium mineralization in the Project
area trends west-northwest, consistent with trends of the fluvial sedimentary
structures of the Westwater Canyon Member, and the general trend of
mineralization across the Ambrosia Lake subdistrict.

Core recovery from the 2007 drilling program indicates that
uranium occurs in sandstones with large amounts of organic/high carbon material.
Non-mineralized host rock is much lighter (light brown to light grey) and has
background to slightly elevated radiometric readings.

History

Kerr-McGee Oil Industries, Inc. (Kerr-McGee) staked the Roca
Honda Project unpatented mining claims in Sections 9 and 10 in June 1965.
Kerr-McGee, its subsidiaries, and successor in interest Rio Algom had held the
claims until the property was acquired by Strathmore on March 12, 2004. Energy
Fuels acquired a 100% interest in Strathmore in September 2013, assuming
Strathmores 60% ownership interest in RHR and becoming the project operator.

Drilling on the property began in 1966. Kerr-McGee performed a
number of rotary drill hole exploration programs from 1966 to 1985. In Section
9, the first drill hole was completed in July 1966. Discovery was made in drill
hole number 7 completed on August 2, 1970, which encountered mineralization at a
depth of 1,900 ft. From 1966 to 1982, a total of 187 drill holes were completed
for a total of 388,374 ft.

In Section 10, the first hole was drilled in October 1967.
Discovery was made in drill hole number 6 completed on March 19, 1974, which
encountered mineralization at a depth of 2,318 ft. From 1967 to 1985, a total of
175 drill holes were completed for a total of 459,535 ft.

In Section 16, the first drilling was in the 1950s by Rare
Metals, which drilled 13 holes, including two that intercepted high-grade
uranium mineralization at depths of 1,531 ft. and 1,566 ft. No records of the
total drilled footage were located. Subsequently, Western Nuclear acquired a
mining lease for Section 16 from the State and began drilling in 1968, with the
first drill hole completed on August 17, 1968. The second drill hole intercepted
high- grade uranium mineralization at a depth of 1,587 ft. From 1968 through
September 1970, Western Nuclear drilled 63 holes totaling 121,164 feet, not
including six abandoned holes totaling 7,835 ft. Two of the drill holes reported
cored intervals, but the cores and analyses were not available.

RHR drilled four pilot holes on Section 16, of which three were
completed as monitor wells totaling 8,050 feet for environmental baseline and
monitoring purposes in Section 16 from June through November 2007. One drill
hole was located outside of known mineralization, and three holes were located
within mineralized areas. The entire thickness of the Westwater Sandstone,
except for zones with no recovery, was cored in the pilot holes for these wells.
The cores are PQ diameter (3.345 in.) and were taken principally for laboratory
testing of hydraulic conductivity, effective porosity, density, and chemical
analysis.

In November 2011, a core hole was drilled at the Section 16
shaft location (Figure 10-2). The hole was drilled to a depth of 2,053 ft. Core
was tested for numerous geotechnical properties.

No historic mineral extraction has occurred on the property.

Mineralization

Uranium mineralization consists of unidentifiable
organic-uranium oxide complexes. The uranium in the project area is dark grey to
black in color, and is found between depths of approximately 1,650 feet and
2,600 feet below the surface.

Primary mineralization pre-dates, and is not related to,
present structural features. There is a possibility of some redistribution and
stack mineralization along faults; however, it appears that most of the Roca
Honda Project mineralization is primary.

Paleochannels that contain quartz-rich, arkosic, fluvial
sandstones are the primary mineralization control associated with this trend.
Previous mining operations within the immediate area suggest that faults in the
Roca Honda Project area associated with the San Mateo fault zone post-date the
emplacement of uranium. Therefore, it may be expected that mineralized zones in
the Roca Honda Project area are offset by faults.

64

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The mineralization is typically confined to sandstones in the
Westwater Canyon Member, although there is some overlap into the shales that
divide the sandstones, and also some minor extension (less than 10 feet) into
the underlying Recapture Member. The mineralization is contained in the
Westwater Canyon Member sandstones across the Project area, but in Sections 9
and 16, the mineralization is typically found in the upper sandstones (A, B1,
and B2). In Section 10, the A and B1 sandstones pinch out in some areas due to
thickening of the overlying Brushy Basin Member. Mineralization in the middle
and western portions of Section 10, and it is typically in the lower sandstones
(sands C and D).

Sedimentary features may exhibit control on a small scale. At
the nearby Johnny M mine, a sandstone scour feature truncates underlying black
mineralization, indicating nearly syngenetic deposition of uranium
mineralization with the sandstone beds.

Present Condition of the Property and Work Completed to Date

Old drill roads were previously established across the
property, and an electrical line transects the northern half of Section 16 in
the project area. The line continues on the west side of the project area into
Section 17, where it terminates, and on the east side of Section 16 through the
northwest quarter of Section 15 and along the southern section boundary of
Section 10. Three monitor water wells were drilled by RHR in 2007, and are
located on Section 16. Other items installed by RHR include a permanent
electrical weather station and a high volume TSP and PM10 air
samplers. Three, dry man-made impoundments are also located on Section 16. More
than 400 historic drill exploration holes were completed on the property from
the late 1960s to the early 1980s. As the property has not yet been developed
or operated, there are no mine workings, existing tailings ponds, waste deposits
or other improvements or facilities at the site. See Acquisition of
Properties Adjacent to the RHR Joint Venture Properties, below, for
description of existing infrastructure on properties acquired by the Company in
2015 adjacent to the Roca Honda Project.

No additional exploration work or activities have been
conducted on the Roca Honda Project since November 2011, when a core drill hole
was completed in Section 16 for geotechnical studies.

The Roca Honda Project was acquired by the Company in August
2013, through the Companys acquisition of Strathmore. As of December 31, 2015,
the total cost attributable to the Roca Honda Project on the financial
statements of the Company was $16.51 million.

The Companys Planned Work

The Company intends to continue its permitting and related
activities at the Roca Honda Project during 2016. Approximately $1 million is
budgeted for permitting efforts in 2016.

Mineral Resource Estimates

RPA prepared an updated NI 43-101 compliant Mineral Resource
estimate for the Roca Honda Project in the Roca Honda Technical Report. The
updated Mineral Resource estimate for the Roca Honda deposit effective as at
February 4, 2015, is summarized in Table 1-1. Mineral Resources are constrained
by wireframes generated around individual mineralized zones within five sand
horizons designated as A, B1, B2, C, and D sands.

|Classification                             | Tons 
    (,000) | Grade %eU3O8 | Pounds U3O8
      (,000)
|------------------------------------------ | ---------------- | ------------ | ------------------------
|Measured Resources                         | 208              | 0.477        | 1,984                   
|Indicated
      Resources                  | 1,303            | 0.483        | 12,580                  
|Total Measured
      & Indicated Resources | 1,511            | 0.482        | 14,564                  
|Inferred Resources                         | 1,198            | 0.468        | 11,206                  

Notes:

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| | 1. | CIM definitions were followed for Mineral Resources,
      which does not represent reserves under SEC Industry Guide 7. See
      Cautionary Note to U.S. Investors Concerning Disclosure of Mineral
      Resources
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2. | Mineral Resources are estimated using a cut-off grade of
      0.19% U3 O8.                                                                                                                                            
| | 3. | A minimum mining thickness of six feet was used, along
      with $241/ton operating cost and $65/lb U3 O8 cut-off grade and 95% recovery.                                                                             
| | 4. | Mineral Resources that are not reserves under SEC
      Industry Guide 7 do not
      have demonstrated economic viability.                                                                                            
| | 5. | Numbers may not add due to
rounding.                                                                                                                                                                                   

The Mineral Resource estimate and classification are in
accordance with the CIM definitions. There are no reserves on the
property at this time.

RPA noted that it is not aware of any known environmental,
permitting, legal, title, taxation, socioeconomic, marketing, political, or
other relevant factors that could materially affect the current resource
estimate.

Acquisition of Properties Adjacent to the RHR Joint Venture
Properties

In August, 2015 the Company acquired properties (the
Adjacent Roca Honda Properties) adjacent to the Roca Honda Project from
Uranium Resources, Inc. which have not been added to the RHR joint venture. The
map below illustrates the proximity of Adjacent Roca Honda Properties to the
Roca Honda Project.



The following description of the Adjacent Roca Honda Properties
is based on the NI 43-101 Technical Report prepared for the Company titled NI
43-101 Technical Review and Evaluation of the Exploration Potential of the Roca
Honda Project, New Mexico, USA dated March 4, 2016, prepared by Geoffrey S.
Carter of Broad Oak Associates.

The Adjacent Roca Honda Properties comprise 4,320 acres of
public and private land holdings consisting of one section of private mineral
and surface (Section 17, T13N, R8W; the Company owns the minerals, but not the
surface of the 622 acres in this section), and 203 unpatented lode claims on
both Cibola National Forest Land and private surface in all or part of Sections 2, 3, 4, 5, 6, 8, 11, and
12, T13N, R8W, and Sections 31 and 32, T14N, R8W. The Company owns the claims in
Section 8 (36 claims-623 acres) and holds all others (167 claims- 3,076 acres)
as lessee, by assignment, of a Mineral Lease Agreement dated February 1, 2006
with Enerdyne Endy Claims LLC. The Company and the lessor are currently involved
in negotiations for an additional ten-year term on the lease.

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Sections 11 and 12 were explored through deep drilling by
Conoco and others in the 1970s and early 1980s. All other sections were explored
by Kerr McGee from the mid-60s until 1982, including over 900 holes drilled in
sections 5, 6, 8, and 17. Kerr McGee advanced the project to a feasibility
study, and in 1981 began construction of the Lee mine with the sinking of a 14
foot diameter shaft in the NE 1⁄4 of Section 17. The shaft penetrated into the
Westwater Canyon Member (1,470 feet), but did not reach the total planned depth
of 1,655 feet. No further work has been completed on this shaft since 1982.

Numerous previous owners and operators have completed resource
estimates. The Company considers those resource estimates to be historical in
nature and not in accordance with NI 43-101. Readers should be cautioned that a
qualified person has not done sufficient work to classify this estimate as a
current estimate of mineral resources or mineral reserves, and as such the
Company is not treating it as a current estimate of mineral reserves or mineral
resources. However, the Company believes the estimate is relevant and reliable,
as it was prepared within the last two years by a reputable mining consultant.
In order to upgrade and verify this historical estimate and classify it as a
current mineral resource estimate, the Company needs to perform further
evaluations of the report and confirm that its underlying assumptions continue
to be reasonable and that the report is complete and current. The mineralized
areas with the best potential to hold mineral resources are Section 17, where
over 500 holes have been drilled, and Section 11 where historical data from
wide-spaced holes drilled by Conoco, Homestake and Anaconda provides an
excellent starting point for high potential resource development.

Below is the Historic Resource Estimate for Section 17, T13N,
R8W:

Historic Mineral Resources for Section
      17(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)Probable Reserves(2)
    809
    0.27%
    4,444Possible Reserves(2)
    Not provided
    Not provided
    557Total(3)
    
    
    5,001


| | (1) | All numbers are rounded. Mineral resources that are not

      reserves do not have demonstrated economic viability. Information
      shown in the tables above and below differs from the disclosure
      requirements of the SEC. See Cautionary Note to U.S. Investors
      Concerning Disclosure of Mineral Resources, above.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | The reserves in this table were calculated on a historic
      basis and do not represent reserves under SEC Industry Guide 7.                                                                                                                                                                                                        
| | (3) | The historic resource estimate was prepared by Douglas
      International, Inc. in 1996 for URI, using a cut-off grade of 0.05%
      U3O8, a GT cut-off of 0.05, and a tonnage factor of
      16 cubic feet per ton.                                                                                                               

No historic mineral extraction has occurred on the Adjacent
Roca Honda Properties.

As of December 31, 2015, the total cost attributable to the
Adjacent Roca Honda Properties on the financial statements of the Company was
$2.96 million.

During 2016, on the assumption that the Company successfully
completes its acquisition of Sumitomos interest in the Roca Honda Project, the
Company plans to integrate the Adjacent Roca Honda Properties into the
permitting efforts underway for the Roca Honda Project properties.

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The Sheep Mountain Project



Unless otherwise stated (concerning land tenure and permitting
efforts), the following technical and scientific description of the Sheep
Mountain Project is derived from a technical report titled Sheep Mountain
Uranium Project, Fremont County, Wyoming, USA, Updated Preliminary Feasibility
Study, National Instrument 43-101 Technical Report, dated April 13, 2012 and,
prepared by Douglas L. Beahm, P.E., P.G., Principal Engineer of BRS Engineering
in accordance with NI 43-101 (the Sheep Mountain Technical Report). The
author of the Sheep Mountain Technical Report is a qualified person and is
independent of the Company within the meaning of NI 43-101. The Sheep Mountain
Technical Report is available on SEDAR at www.sedar.com. The Sheep
Mountain Project does not have known reserves, and is therefore considered under
SEC Industry Guide 7 definitions to be exploratory in nature, despite currently
ongoing permitting activities.

Project Description and Location

The Sheep Mountain Project is an underground and open pit
uranium project that is currently being permitted by the Company. The Sheep
Mountain Project was acquired on February 29, 2012, as a result of the Companys
acquisition of Titan. The Sheep Mountain Project is located eight miles south of
Jeffrey City, Wyoming within the Wyoming Basin physiographic province at the
northern edge of the Great Divide Basin in central Wyoming. The project is
located in portions of Sections 8, 9, 15, 16, 17, 20, 21, 22, 27, 28, 29, 30,
31, 32, and 33, Township 28 North, Range 92 West.

The Sheep Mountain Project includes the Congo Pit, a proposed
open pit uranium extraction facility, and the reopening of the existing Sheep
Underground facility. Although alternatives were considered, the recommended
recovery method in the Sheep Mountain Technical Report includes the processing
of extracted materials via an on-site heap leach facility. Material from the
underground and open pit operations are expected to be commingled at the stockpile site located near the underground portal and in
close proximity to the pit. At the stockpile, the mineralized material will be
sized if needed, blended, and then conveyed via a covered overland conveyor
system to the heap leach pad where it will be stacked on a double lined pad for
leaching. The primary lixiviant will be sulfuric acid. Concentrated leach
solution will be collected by gravity in a double lined collection pond and then
transferred to the mineral processing facility for extraction and drying. The
final product produced will be uranium concentrate (U3O8, also known as yellowcake). Since the Sheep Mountain Technical Report was
completed, Energy Fuels has acquired the White Mesa Mill and the Nichols Ranch
Plant, which creates the option to transport loaded resin to either of those
facilities for stripping, and to the White Mesa Mill for drying, and packaging
of yellowcake.

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The preferred alternative for the development of the Sheep
Mountain Project begins the operation with the open pit and heap leach facility
and brings the underground component of the project into operation about five
years later such that the forecasted end of extraction for both the open pit and
underground components coincide. This approach defers a substantial amount of
initial capital, minimizes risk, and allows for a gradual startup of site
activities while maximizing resource recovery. Having the end of extraction
coincide for both operations also optimizes the fixed costs of personnel and
facilities. A preliminary feasibility study (PFS) for the project has
been completed in accordance with NI 43-101, which includes the preliminary
design and sequencing of the open pit and underground operations and the heap
leach mineral processing facility. Designs and sequencing are inclusive of
pre-production, production, and decommissioning and reclamation.

The current design for the Congo Pit includes typical highwall
heights in the range of 100 to 400 feet, and reaches a maximum depth of 600 feet
in localized areas in the southeast pit corner. The open pit design employs
similar design parameters and mining equipment configurations to those used
successfully in past Wyoming conventional operations. Highwall design is based
upon the performance of past projects in the Sheep Mountain and Gas Hills
districts, and includes an average highwall slope of 0.7:1, which reflects the
average of a 10-foot bench width and 50-foot wall at a 0.5:1 slope.

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The underground method proposed is also a conventional method
using a modified room and pillar method, but utilizing modern equipment such as
jumbo drills and 7 cubic-yard scooptrams for haulage. A new double entry decline
will be constructed starting at the Paydirt Pit and ending below the deposit.
Haulage from the facility will be accomplished via a 36-inch conveyor within one of
the double declines. The existing shafts will be used for ventilation purposes
only, with exhaust fans mounted at both locations. If the existing borehole
ventilation shafts can be rehabilitated, they will be used as intake shafts.

In 2013, we submitted a revised PO to the BLM, which included
redesign of the heap leach processing area and potential transportation of the
mineralized material to an off-site processing facility. The revision to the PO
is expected to give us more flexibility in processing the resources extracted
from the Sheep Mountain Project.

Accessibility, Climate, Local Resources, Infrastructure, and
Physiology

The Sheep Mountain Project is located at approximate Latitude
42°24 North and Longitude 107° 49 West, within the Wyoming Basin physiographic
province in the Great Divide Basin at the northern edge of the Great Divide
Basin. The project is approximately eight miles south of Jeffrey City, Wyoming.
The nearest commercial airport is located in Riverton, Wyoming approximately 56
miles from Jeffrey City on a paved two-lane state highway. The project is
accessible via 2-wheel drive on existing county and two-track roads.

The Sheep Mountain Project falls within the intermountain
semi-desert weather province, with average maximum temperatures ranging from
31.1 °F (January and December) to 84.9 °F (July), average minimum temperatures
ranging from 9.1 °F (January) to 49.2 °F (July), and average total precipitation
ranging from 0.36 -inches (January) to 2.04 -inches (May). The topography
consists of rounded hills with moderate to steep slopes. Elevations range from
6,600 feet to 8,000 feet above sea level. The ground is sparsely vegetated with
sage and grasses and occasional small to medium sized pine trees at higher
elevations. Year-round operations are contemplated for the Sheep Mountain
Project.

Telephone, electric and natural gas service adequate for the
planned extraction and mineral processing operations have been established at
the Sheep Mountain Project. Electric service and a waterline have been extended
via right-of-way issued by the BLM in 2011 to the existing Sheep 1 and 2 shafts.
Adequate water rights are held by the Company for planned extraction and mineral
processing operations but need to be updated with the Wyoming State Engineer
with respect to type of industrial use, points of diversion, and points of use.

We believe that sufficient surface rights are in place for all
contemplated operations, including tailings storage areas, waste disposal, heap
leach pads, and potential processing sites.

Ownership

The mineral properties at the Sheep Mountain Project are
comprised of 192 unpatented mining claims (the Company added 13 claims to the
179 reported in the Sheep Mountain Technical Report) on land administered by the
BLM; approximately 640 acres of State of Wyoming leases; and approximately 630
acres of private leases on fee lands. In February 2012, Energy Fuels purchased
320 acres of private surface overlaying some of the federal minerals covered by
18 of the claims. The purchased parcel includes the SW1⁄4 SW1⁄4 Section 28 and SE1⁄4,
E1⁄2 SW1⁄4, and NW1⁄4 SW1⁄4 Section 29, T28N, R92W. A final payment of $5,000 was made
in January 2016 for the purchased parcel. The combination of land holdings
(including the 13 new claims) comprises approximately 4,675 acres and gives
Energy Fuels mineral rights to resources as defined in the Congo Pit and the
Sheep Underground areas.

To maintain these mineral rights, the Company must comply with
the lease provisions, including annual payments with respect to the State of
Wyoming leases; private leases; BLM and Fremont County, as well as Wyoming
filing and/or annual payment requirements to maintain the validity of the
unpatented mining lode claims as follows. Mining claims are subject to annual
filing requirements and payment of a fee of $155 per claim. Unpatented mining
claims expire annually, but are subject to indefinite annual renewal by filing
appropriate documents and paying the fees described above. ML 0-15536 will
expire on 1/1/2024. Annual Payments to maintain ML 0-15536 are $2,560 per year.The original private lease dated November 20, 2975 between McIntosh
Cattle Company and Western Nuclear Inc. (the Private Lease) expired
11/20/2015. Properties covered by the Private Lease include: Township 28 North,
Range 92 West, 6th PM; Section 20: S1⁄2SW1⁄4; Section 29: NW1⁄4, SW1⁄4SW1⁄4; Section 30:
SE1⁄4NE1⁄4, E1⁄2SE1⁄4; Section 31: E1⁄2NE1⁄4; Section 32: E1⁄2NE1⁄4; Section 33: S1⁄2NW1⁄4. Since
the date of the Sheep Mountain Technical Report, the Company no longer holds the
Private Lease, however a Surface Owners Agreement (originally dated January 27,
1970, as amended on April 14, 1981 and ratified by assignees on April 16, 2007) covering the same parcels and a few select claims in the Sun-Mc
area is still in effect. It carries a 2% mine value royalty for any material
extracted from the subject lands, but no other payment obligations.

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The Sheep Mountain Project is subject to an overall sliding
scale royalty of 1% to 4% due to Western Nuclear, based on the Nuclear Exchange
Corporation Exchange (NUEXCO) Value. This royalty is currently at its
maximum rate of 4%. Under Wyoming State Lease ML 0-15536, there is a royalty of
5% of the quantity or gross realization value of the U3O8,
based on the total arms-length consideration received for uranium products
sold.

Uranium mining in Wyoming is subject to both a gross products
(county) and mineral severance tax (state). At the federal level: aggregate
corporate profit from mining ventures is taxable at corporate income tax rates,
i.e. individual mining projects are not assessed federal income tax but rather
the corporate entity is assessed as a whole. For mineral properties: depletion
tax credits are available on a cost or percentage basis whichever is greater.
The percentage depletion tax credit for uranium is 22%, among the highest for
mineral commodities, IRS Pub. 535.

Permitting and Licensing

In June 2010, Titan commenced baseline environmental studies to
support an application to the NRC for a Source Material and By-product Material
License (the License) for operation of a heap leach facility. Work was
also initiated on a revision to the existing WDEQ Mine Permit, as well as a PO
for the BLM. Baseline studies included wildlife and vegetation surveys, air
quality and meteorological monitoring, ground and surface water monitoring,
radiological monitoring, and cultural resource surveys.

Submission of the PO to the BLM was made in June 2011. The PO
was accepted as complete by the BLM, and an EIS was initiated in August 2011.
Energy Fuels revised the PO in July 2012, consistent with the modified plan
presented in the Sheep Mountain Technical Report. In July 2013, the PO was again
revised to reflect a new waste rock disposal layout for the open pit mine and an
improved and more economical heap leach and processing facility. The revised PO
also included the option of transporting mineralized material off-site for
processing. The EIS is in the late stage of permitting, with a Final EIS
expected to be issued in mid-to-late 2016.

In October 2011, Titan submitted a draft revision to its
existing Mine Permit 381C to WDEQ. WDEQ then provided Titan with review comments
as part of its courtesy review. The permit revision was revised and
resubmitted in January 2014. In July 2015, the revision was approved by the
WDEQ. The revision includes expansion of surface and underground mining
operations and an updated reclamation plan consistent with current reclamation
practices.

Development of an application to the NRC for a license to
construct and operate the uranium recovery facility has been taken to an
advanced stage of preparation. This license would allow Energy Fuels to process
the mineralized material into yellowcake at the Sheep Mountain Project site. The
draft application to NRC for a Source Material License was reviewed in detail by
the NRC in October 2011. The NRC audit report identified areas where additional
information should be provided. The review and approval process for this license
by the NRC is anticipated to take approximately four years from the date
submitted to the NRC. Submittal of the license application to the NRC is on hold
pending the Companys evaluation of off-site processing options for this project,
and if a decision is made to proceed with an on-site uranium recovery facility,
pending improvements in uranium market conditions.

Geological Setting

A primary component of the geology for the Sheep Mountain
Project is the Battle Spring Formation. Battle Spring is Eocene in age. Prior to
deposition of the Battle Spring Formation and subsequent younger Tertiary
formations, underlying Paleocene, Cretaceous, and older formations were deformed
during the Laramide Orogeny. During the Laramide Orogeny, faults, including the
Emigrant Thrust Fault at the northern end of the project area, were active and
displaced sediments by over 20,000 feet. Coincident with this mountain building
event, Paleocene and older formations were folded in a series of echelon
anticlines and synclines, generally trending from southeast to northwest. The
Battle Spring Formation was deposited unconformably on an erosional landscape
influenced by these pre-depositional features. Initial stream channels
transporting clastic sediments from the Granite Mountains formed in the
synclinal valleys.

The geologic setting of the Sheep Mountain Project is important
in that it controlled uranium mineralization by focusing movement of the
groundwaters which emplaced the uranium into the stream channels which had
developed on the pre-tertiary landscape. The Battle Spring Formation and
associated mineralization at the Sheep Mountain Project is bounded to the east by the western flank of the
Sheep Mountain Syncline and to the west by the Spring Creek Anticline. To the
north the system is cut off by erosion. To the south the Battle Spring continues
into the northern portions of the Great Divide Basin.

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Mineralization occurs throughout the lower A Member of the
Battle Spring Formation and is locally up to 1,500 feet thick. The upper B
Member is present only in portions of the project and may be up to 500 feet
thick. Although arkosic sandstone is the preferred host, uranium has been
extracted from all lithologies. Grade and thickness are extremely variable
depending on whether the samples are taken from the nose or the tails of a roll
front. Typically the deposits range from 50 feet to 200 feet along a strike,
five feet to eight feet in height, and 20 feet to 100 feet in width. Deposits in
the Sheep Mountain Project area occur in stacked horizons from 7,127 feet in
elevation down to 6,050 feet in elevation.

History

The Sheep Mountain Project was acquired by Energy Fuels on
February 29, 2012, as a result of the Companys acquisition of Titan, which is
now a wholly owned subsidiary of Energy Fuels. Titan acquired the Sheep Mountain
Project in two transactions in 2009. A 50% working interest was acquired when
Titan completed a business combination with Uranium Power Corp. (UPC)
on July 31, 2009. UPC is now a wholly-owned subsidiary of Energy Fuels. At that
time, UPC and UPCs US subsidiary (then called UPC Uranium (USA) Inc. and now
called Energy Fuels Wyoming Inc.) became wholly-owned subsidiaries of Titan. The
remaining 50% of the Sheep Mountain Project was owned by Uranium One Inc.
(U1) which was UPCs joint venture partner for the project. On October
1, 2009, Titan acquired U1s 50% interest, giving Titan a 100% interest in the
Sheep Mountain Project. On February 29, 2012, Energy Fuels acquired Titan (and
its subsidiaries) at which point the Sheep Mountain Project became 100% owned by
the Company.

The Sheep Mountain Project was operated as an underground and
open pit mine at various times in the 1970s and 1980s. 5,063,813 tons of
mineralized material were mined and milled, yielding 17,385,116 pounds of
uranium at an average grade of 0.17% U3O8. Mining was
suspended in 1988 and the project has been on care and maintenance since that
time.

Uranium was first discovered in the Crooks Gap District, which
includes the Sheep Mountain Project, in 1953 (Bendix, 1982). While the original
discoveries were aided by aerial and ground radiometric surveys, exploration
activities were primarily related to drilling and exploratory trenching. Three
companies dominated the district by the mid-1950s: Western Nuclear Inc.
(Western Nuclear), Phelps Dodge Corporation (Phelps Dodge),
and Continental Uranium Corporation (Continental). Western Nuclear
built the Split Rock mill at Jeffrey City in 1957 and initiated production from
the Paydirt pit in 1961, Golden Goose 1 in 1966, and Golden Goose 2 in 1970.
Phelps Dodge was the principal shareholder and operator of the Green Mountain
Uranium Corporations Ravine Mine which began production in 1956. Continental
developed the Seismic Pit in 1956, the Seismic Mine in 1957, the Reserve Mine in
1961, and the Congo Decline in 1968. In 1967, Continental acquired the Phelps
Dodge properties and in 1972, Western Nuclear acquired all of Continentals
Crooks Gap holdings. During the mid-1970s Phelps Dodge acquired an interest in
Western Nuclear which began work on the Sheep Mountain I in 1974, the McIntosh
Pit in 1975, and Sheep Mountain II in 1976. Western Nuclear ceased production
from the area in 1982. Western Nuclear production from the Sheep Mountain I is
reported to have been 312,701 tons at 0.107% U3O8.
Subsequent to the closure of the Sheep Mountain I by Western Nuclear, during
April to September 1987, Pathfinder Mines Corporation (Pathfinder)
mined a reported 12,959 tons, containing 39,898 pounds of uranium at an average
grade of 0.154% U3O8 from Sheep Mountain I. U.S.
Energy-Crested Corp. (USECC) acquired the properties from Western
Nuclear in 1988, and during May to October 1988, USECC mined 23,000 tons from
Sheep Mountain I, recovering 100,000 pounds of uranium for a mill head grade of
0.216% U3O8. The material was treated at
Pathfinders Shirley Basin mill, 130 miles east of the Project. The Sheep Mountain
I mine was allowed to flood in April 2007. UPC (then known as Bell Coast
Capital) acquired a 50% interest in the property from USECC in late 2007. USECC
later sold all of its uranium assets to U1. Titan acquired UPCs 50% interest in
the property when it acquired UPC by a plan of arrangement in July 2009. Titan
acquired U1s interest in the Sheep Mountain Project in September 2009.

During the National Uranium Resource Evaluation (NURE)
program conducted by the DOE in the late 1970s and early 1980s, the project
area and vicinity were evaluated. This evaluation included aerial gamma,
magnetic, and gravimetric surveys, soil and surface water geochemical surveys
and sampling, and geologic studies and classification of environments favorable
for uranium mineralization.

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Approximately 4,000 holes were drilled in the project area
historically (prior to 1988), most of which were open-hole rotary drilling,
reliant upon down-hole geophysical logging to determine equivalent uranium grade
%eU3O8.

However, some core drilling for chemical analysis was also
completed. The drill maps show hole locations at the surface and downhole drift,
the thickness and radiometric grade of uranium measured in weight percent
U3O8, elevation to the bottom of the
mineralized intercept, collar elevation, and elevation of the bottom of the
hole.

In 2006, UPC completed a drilling program consisting of 19
holes totaling 12,072 feet. Two of the 19 holes were located in Section 28 with
the purpose of confirming the mineralization within the Sheep Underground mine
area. The remaining 17 holes were completed in the planned Congo Pit to test
both shallow mineralization and to explore a deeper mineralized horizon. This
2006 drilling has confirmed the presence of mineralization in the shallow
horizons of the Congo Pit area and has identified and extended roll front
mineralization in the 58 sand along strike.

Following the acquisition of UPC by Titan, five holes were
drilled in the Congo Pit area in 2009 for a total of 1,700 feet. In situ mineral
grades for 2009 drilling were determined by geophysical logging including both
conventional gamma logging and state of the art Uranium Spectrum Analysis Tool.
Titan also drilled in the Congo Pit area in 2010 62 exploratory drill holes and
5 monitor wells and 2011 73 exploratory drill holes and 5 monitor wells. There
were a total of 140 exploration holes drilled between 2009 and 2011, which total
about 44,000 feet.

No relevant exploration work other than this drilling has been
conducted on the property in recent years. The project is located within a
brownfield site which has experienced past mine production and extensive
exploration and development drilling. The initial discovery was based on aerial
and ground radiometric surveys in the 1950's, but since that time exploratory
work on the site has been primarily drilling.

Mineralization

Most of the mineralization in the Crooks Gap District occurs in
roll-front deposits. Roll fronts have an erratic linear distribution but are
usually concordant with the bedding. Deposits have been discovered from the
surface down to a depth of 1,500 feet. The two major uranium minerals are
uranophane and autunite. Exploration drilling indicated that the deeper
roll-type deposits are concentrated in synclinal troughs in the lower Battle
Spring Formation. Three possible sources for uranium have been suggested:
post-Eocene tuffaceous sediments, leached Battle Spring arkoses, and Precambrian
granites. Structural controls of uranium occurrences along roll fronts include
carbonaceous siltstone beds that provide a local reducing environment for
precipitation of uranium-bearing minerals, and abrupt changes in permeability
along faults, where impermeable gouge is in contact with permeable sandstones.
Uranium has also been localized along the edges of stream channels and at
contacts with carbonaceous shales

Present Condition of the Property and Work Completed to Date

The Sheep Mountain Project includes the Congo Pit, a proposed
open pit uranium extraction facility, and the reopening of the existing Sheep
Underground mining facility. Mineral Extraction at the Sheep Underground mining
facility was suspended
in 1988 and the project has been on care and maintenance since that time.

The Sheep Mountain Project does not currently have a processing
facility. Transportation of mineralized materials to the White Mesa Mill is not
economic at current or foreseeable uranium price levels. As a result, it will be
necessary to permit and construct a heap leach or other processing facility at
the site, or make arrangements to process Sheep Mountain mineralized materials
at a third party processing facility.

The Company is subject to liabilities for mine and exploration
reclamation at the Sheep Mountain project. The Company maintains four (4) bonds
with the State of Wyoming as security for these liabilities. The Company files
annual reports with the State of Wyoming, and the amount of the bonds may be
adjusted annually to ensure sufficient surety is in place to cover the full cost
of reclamation. The Companys reclamation of the exploration drilling performed
by Titan was deemed complete in October 2014; the drilling permit was terminated
and that bond was fully released.

The Sheep Mountain Project was acquired by the Company in
February 2012, through the Companys acquisition of Titan. As of December 31,
2015, the total cost attributable to the Sheep Mountain Project on the financial
statements of the Company was $34.18 million.

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The Companys Planned Work

The Company intends to continue to pursue all mining and
related permits at the Sheep Mountain Project during 2016. The Company will also
continue to evaluate its options for processing Sheep Mountain mineralized
material, including continuing to pursue permitting for a heap leach facility at
the site, evaluating other types of processing facilities at the site, or
determining whether arrangements can be made to process Sheep Mountain
mineralized materials at a third party processing facility. Submittal of the
license application to the NRC for a heap leach processing facility at the site
is on hold pending the Companys evaluation of off-site processing options for
this project. Once all mining and related permits are obtained, the project will
be placed on standby, pending completion of the evaluation of the processing
options for the Project and improvement of market conditions.

Mineral Resource and Mineral Reserve Estimates

Mineral Resources

The Mineral Resource estimates for the Sheep Mountain Project
are summarized in the following table. The Mineral Resource estimates presented
herein have been completed in accordance with CIM Standards and NI 43-101. Based
on the drill density, the apparent continuity of the mineralization along
trends, geologic correlation and modeling of the deposit, a review of historic
mining with respect to current resource projections, and verification drilling,
the Mineral Resource estimate herein meets CIM criteria as an Indicated Mineral
Resource. These Indicated Mineral Resources are not reserves within the meaning
of SEC Industry Guide 7. See Cautionary Note to U.S. Investors Concerning
Disclosure of Mineral Resources, above.

Below is a summary of the total Indicated Mineral
Resources(1)estimated for the Sheep Mountain Project:

|Sheep Underground                         | GT Cutoff                | >0.30     
|----------------------------------------- | ------------------------ | ----------
|                                          | Pounds eU3O8             | 13,245,000
|                                          | Tons                     | 5,640,000 
|                                          | Avg.
      Grade % eU3O8 | 0.117     
|Congo Pit Area                            | GT
      Cutoff          | >0.10     
|                                          | Pounds eU3O8             | 15,040,000
|                                          | Tons                     | 6,176,000 
|                                          | Avg.
      Grade % eU3O8 | 0.122     
|Sun-Mc                                    | GT
      Cutoff          | >0.10     
|                                          | Pounds eU3O8             | 2,000,000 
|                                          | Tons                     | 1,080,000 
|                                          | Avg.
      Grade % eU3O8 | 0.093     
|Total Indicated Mineral
      Resource(1) | GT Cutoff                | As Above  
|                                          | Pounds eU3O8             | 30,285,000
|                                          | Tons                     | 12,895,000
|                                          | Avg. Grade % eU3O8       | 0.117     

|(1) | The Mineral Resource estimates comply with the
      requirements of NI 43-101 and the classifications comply with CIM
      definition standards and do not represent reserves under SEC Industry
      Guide 7. Resources that are not  reserves do not have demonstrated
      economic viability. See Cautionary Note to U.S. Investors Concerning
      Disclosure of Mineral Resourcesabove.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

This estimate includes deletion of the portions of the mineral
resource model which falls within the historic limits in the Congo Pit estimated
to have removed some 25% of the initial resource estimate and the total reported
mined tonnage from the historic Sheep I underground mine. From review of the Sheep I and
II as-built mine plans, it was apparent that little or no ore was mined at the
historic Sheep
II and that only development work was completed. Historic underground mining in
the Sun Mc area is estimated to have removed some 10% of the total resource.
Although in many cases the mine maps showed remnant pillars, none of these areas
were included in the mineral resource estimate. Thus, the estimate of current
mineral resources is conservative with respect to the exclusion of areas
affected by historic mining. Estimated mineral resources for potential open pit
areas were diluted to a minimum mining thickness of two feet and a cutoff grade
of 0.05% U3O8.equates to a 0.10 GT cutoff.

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Mineral Reserves

The estimate of mineral reserves for the Sheep underground
extraction area is
set out in the Sheep Mountain Technical Report and is unchanged from the
previous reports (BRS, 2010 and 2011). With respect to the open pit mineral
reserves, mineral resources for the Congo, North Gap, and South Congo areas were
combined into a single comprehensive mineral resource model. Open pit mine
designs and sequencing was completed for all areas, and the resultant mineral
reserve estimate reflects the current open pit mine designs and economic
evaluations. These reserves have been calculated in accordance with NI 43-101
and should not be considered to meet the definition of  reserves within
the meaning of SEC Industry Guide 7. Resources that are not reserves do
not have demonstrated economic viability. See Cautionary Note to U.S. Investors
Concerning Disclosure of Mineral Resources, above.

Below is a summary of the total Probable Mineral
Reserve(1)estimate for the Sheep Mountain Project as calculated in
accordance with NI 43-101:

GTminimum
    Lbs.
      eU3O8
    Tons
    Average Grade%
      eU3O8Open Pit
    0.10
    9,117,000
    3,955,000
    0.115Underground
    0.45
    9,248,000
    3,498,000
    0.132Total
    
    18,365,00
    7,453,000
    0.123


|(1) | The Mineral Reserve estimates comply with the
      requirements of NI 43-101 and the classifications comply with CIM
      definition standards, and are not reserves within the meaning of SEC
      Industry Guide 7. See Cautionary Note to U.S. Investors Concerning
      Disclosure of Mineral Resourcesabove.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Probable Mineral Reserves are fully included in the total
Indicated Mineral Resources for the Congo Pit and are not additive to that
total. The Probable Mineral Reserve is that portion of the Indicated Mineral
Resource that is economic under current cost and pricing conditions. The cutoff
grade of 0.05% eU3O8 at a minimum mining
heightof 2 foot equates to a 0.10 GT cutoff for the Congo Pit. The
cutoff grade of 0.05% eU3O8 at a minimum mining
height of 6 feet equals a 0.30 GT cutoff used for the Sheep underground
extraction area.
The cutoff grade was determined based on an assumed uranium price of $65 per
pound U3O8.

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The Henry Mountains Complex



Except as noted concerning the land and permitting efforts, the
following technical and scientific description of the Henry Mountains Complex is
based on the technical report dated June 27, 2012 titled Technical Report on
the Henry Mountains Complex Uranium Property, Utah, U.S.A., prepared by William
E. Roscoe, Ph.D., P.Eng., Douglas H. Underhill, Ph.D., C.P.G. and Thomas C.
Pool, P.E. of Roscoe Postle Associates Inc. (RPA) in accordance with NI
43-101 (the Henry Mountains Technical Report). Each of the authors of
the Henry Mountains Technical Report is independent of Energy Fuels and a
qualified person for purposes of NI 43-101. The report contains mineral
resource estimates for the Indian Bench, Copper Bench, Southwest and Tony M
deposits.The Henry Mountains Technical Report is available on SEDAR at
www.sedar.com and on EDGAR at www.sec.gov. The Henry Mountains
Complex does not have known reserves, and is therefore considered under SEC
Industry Guide 7 definitions to be exploratory in nature.

Property Description and Location

The Henry Mountains Complex is an underground project comprised
of the Bullfrog Property, hosting the Indian Bench and the Copper Bench
deposits, and the Tony M Property, hosting the Southwest deposit and the Tony M
deposit and associated mineral extraction facilities. The Henry Mountains
Complex is located in eastern Garfield County, Utah.

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Accessibility, Climate, Local Resources, Infrastructure and
Physiography

Road access to the Henry Mountains Complex is by paved Highway
276, running between Hanksville and Bullfrog Basin Marina, Utah. An unimproved
gravel road maintained by Garfield County extends west from Highway 276, passes
by the portal of the Tony M Property, and extends northerly across the property,
the northern end of which is crossed by another county road. The property is
located in a relatively remote area of Utah, and the infrastructure is limited.
The town site of Ticaboo, Utah, is located approximately five miles south of the
property. It has been used to provide housing and municipal services for Tony M
Property staff. The next closest community is Hanksville, Utah, a small town of
a few hundred people, located about 40 miles north of the property. During
operation of the Tony M Property, electricity was generated locally. Materials
and supplies are transported to the site by truck about 275 miles from Salt Lake
City, and about 190 miles from Grand Junction, Colorado. The distance to the
White Mesa Mill is about 117 miles.

The climate is distinctly arid, with an average annual
precipitation of approximately eight inches, including about 12 inches of snow.
The vegetation consists primarily of small plants including some of the major
varieties of blackbrush, sagebrush, and rabbit brush. A few small junipers are
also present. Relief over the combined Henry Mountains Complex is approximately
2,250 feet (the technical report erroneously reported 800 feet). The elevation
on the property ranges from 4,550 ft. above sea level at the portal of the Tony
M Property, near the southern end of the property, to 6,800 ft. above sea level
over the northern end of the property. The terrain is typical canyon lands
topography, with some areas deeply dissected by gullies and headwalls of canyons
and the rest consisting of gently undulating gravel benches covering the
northern part of the project area. The terrain in several parts of the property
is particularly rugged and inaccessible and is the primary reason for the
irregular pattern of surface drill holes in parts of the property.

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Ownership

The Henry Mountains Complex is 100% owned by Energy Fuels, and
was acquired from Denison Mines Corp. and its affiliates in June 2012. The
project consists of one Utah State Mineral Lease for Section 16, Township 35
South, Range 11 East (T35S R11E), Salt Lake Meridian (SLM), and 202 unpatented
federal lode mining claims. The latter consist of 137 B.F., 19 Bull, 19 Star,
two Frog claims (comprising the Bullfrog Property), and 17 TIC and eight Ticaboo
claims, including fractions (comprising the Tony M property). The claims and
state lease comprise one contiguous property located in T34S, R11E and T35S,
R11E, SLM. The Utah State Section 16 includes 638.54 acres, and the 202
unpatented lode mining claims consist of about 3,667.18 acres (not specified in
the technical report), for a total land holding of 4,305.72 acres. The surface
rights are owned by the federal government, administered by the BLM, with the
exception of the state lease which has associated state surface rights.

There is no royalty burden for the 185 claims that comprise the
Bullfrog Property, as well as for the Ticaboo claims. All unpatented mining
claims are subject to an annual federal mining claim maintenance fee of $155 per
claim plus approximately $10 per claim for county filing fees. The 17 TIC claims
are held by Energy Fuels, subject to an annual advance minimum royalty. The
uranium production royalty burden is 4% yellowcake gross value less taxes and
certain other deductions. The vanadium production royalty burden is 2% gross
value less certain deductions. The Utah State Lease carries an annual rental of
$640, plus an escalating annual advance minimum royalty based on the uranium
spot price. Since the technical report was written, the state lease was renewed
in 2015 for an additional 10 year term, which can be extended. Other changes in
the renewed lease include reducing annual advanced royalty payments and
crediting the advanced royalty against the production royalty for the year in
which it is paid plus any amount paid in the five prior years. The uranium
royalty on the State lease is 8% of gross value less certain deductions. The vanadium royalty is 4%
of gross value less certain deductions.

Permitting

Tony M Property:

The original Tony M Property mine permit was allowed to lapse.
Subsequently the previous operator, Denison, filed for exploration permits with
the Utah Division of Oil, Gas and Mining (UDOGM) and the BLM. These
permits were granted by UDOGM and the BLM on December 2, 2005 and March 6, 2006,
respectively, which enabled Denison to regain access, inspect and begin
rehabilitation of the Tony M underground workings. Denison also began the
permitting process for the Tony M Property. The permit application was submitted
in November 2006 and a Record of Decision (RoD) and approved PO were
received in September 2007.

The PO was challenged by the Center for Water Advocacy and the
Utah Chapter of the Sierra Club, which requested a Utah State BLM Director
Review and a stay of the decision approving the Final PO for the Tony M
Property. On November 21, 2007, the BLM State Director issued a decision
vacating the previously issued permit and remanded the case to the Field Office
in order that the EA for the Tony M Mine PO could be amended and a new RoD
issued. As a result of this decision to vacate and renew, the request for stay
was considered moot. The new decision was issued by the BLM on November 23, 2007
approving the PO for the project. The new decision was once again appealed by
the Center for Water Advocacy and the Utah Chapter of the Sierra Club. The Utah
State Director issued a decision denying the appeal and upholding the PO on
February 19, 2008. In addition to the PO and FONSI from the BLM, major permits
for the Tony M property include an approved  Large Mine permit with UDOGM, and
an approved ground water discharge permit with the Utah Division of Water
Quality (DWQ). A reclamation bond of $708,537 is in place.

Permit applications for a Phase 2 expansion were submitted to
the BLM and UDOGM in 2008. The expansion was approved by the UDOGM in 2009, but
Denison subsequently requested that BLM review of the application be deferred
given the market conditions at that time.

Bullfrog Property:

The Company is currently completing environmental baseline
studies and preparing mine plans for permitting purposes at the Bullfrog
Property. The permitting schedule is based on having the BLM PO, the UDOGM Large
Mine Notice of Intent, and other required state and federal permit applications
submitted in  late 2016.

78

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Geologic Setting

Exposed rocks in the project area are Jurassic and Cretaceous
in age. Host rocks for the Copper Bench-Indian Bench and Tony M-Southwest
uranium-vanadium deposits are Upper Jurassic sandstones of the Salt Wash Member
of the Morrison Formation. This formation is located within the Colorado
Plateau. Early Tertiary fluvial and lacustrine sedimentation within the deeper
parts of local basins was followed in mid-Tertiary time by laccolithic intrusion
and extensive volcanism. Intrusions of diorite and monazite porphyry penetrated
the sediments at several sites to form the laccolithic mountains of the central
Colorado Plateau.

The Morrison Formation is a complex fluvial deposit of Late
Jurassic age. In outcrop, the Salt Wash is exposed as one or more massive,
ledge-forming sandstones, generally interbedded with laterally persistent
siltstones or mudstones. The lower Salt Wash is approximately 150 ft. thick in
the Project area, thinning and becoming less sandy northward from the project
area. Sandstones comprise 80% of the sequence, with siltstones and mudstones
making up the remainder. Significant uranium mineralization occurs only in this
lower unit.

History

In 1970 and 1971, Rioamex Corporation conducted a 40-hole
drilling program in an east-west zone extending across the southerly end of the
Bullfrog Property and the northerly end of the Tony M and adjacent Frank M
properties. Some of these holes intercepted significant uranium mineralization.
The Bullfrog deposit was initially explored by Exxon Minerals Company
(Exxon), while the Tony M deposit was explored and advanced by Plateau
Resources Ltd. (Plateau), a subsidiary of Consumers Power Company
(Consumers) of Michigan.

In February 1977, drilling commenced in what was to become the
Tony M deposit. Subsequently, Plateau drilled more than 2,000 rotary drill holes
totaling about 1,000,000 feet. Over 1,200 holes were drilled in the Tony M area.
Following the discovery of the Tony M deposit in 1977, Plateau constructed the
Tony M Property from September 1, 1977, to about May 1984, at which time mining
activities were suspended. By January 31, 1983, over 18 miles of underground
workings were developed at the Tony M Property, and a total of approximately
237,000 tons of mineralized material was extracted with an average chemically
adjusted grade of 0.121% U3O8containing about
573,500 pounds U3O8.The underground workings at the
Tony M Property are accessed via two parallel declines extending about 10,200
ft. into the deposit. The underground workings were allowed to flood after
mining activities were suspended in 1984. The southern one-half of the
underground workings remained dry, as they are located above the static water
table.

Exxon commenced drilling on the Bullfrog Property in 1977.
Before it sold the property to Atlas in July 1982, Exxon had drilled 1,782
holes. From July 1982 to July 1983, Atlas completed 112 drill holes delineating
the Southwest and Copper Bench deposits on approximately 100 ft. centers. After
July 1983, Atlas completed an additional 49 core hole drilling program
throughout the Bullfrog Property, as well as a 133 rotary drill hole program to
delineate the Indian Bench deposit on approximately 200 ft. centers. A total of
2,232 drill holes were completed on the Bullfrog Property.

The Southwest and Copper Bench deposits are delineated by
drilling on approximately 100 foot centers. The Indian Bench deposit is
delineated by drilling on approximately 200 ft. centers. In some areas, the
rugged terrain made access difficult, resulting in an irregular drill pattern.
Records indicate that a total of 81 core holes were drilled in the Southwest,
Copper Bench, and Indian Bench deposits, while 25 core holes were drilled in the
vicinity of the Tony M deposit. The core holes provided samples of the
mineralized zone for chemical and amenability testing.

Denison acquired the Bullfrog Property when it purchased most
of the assets of EFN in 1997. In February 2005, Denison acquired the Tony M
Property bringing it under common ownership with the Bullfrog Property.
Following rehabilitation work at the Tony M Property and re-establishment of
surface facilities in 2006, Denison received operational permits, reopened the
Tony M underground workings and commenced mining activities in September 2007.
This work included a long-hole drilling program to discover and delineate
mineralization within about 100 feet of underground workings. In November 2008,
Denison announced that mining activities at the Tony M Property would be
suspended due to uranium and economic market conditions. During its September
2007 to December 2008 reactivation, cleanup and mining activities, Denison
extracted 162,384 tons of mineralized material at radiometric grade of 0.131%
containing 429,112 pounds U3O8 from within existing
workings and from the previously stockpiled material. This material was
trucked to the White Mesa Mill for processing. In June 2012, Energy Fuels
acquired all of Denisons uranium properties in the United States, including the
Henry Mountains Complex.

No mine development has been conducted on the Southwest portion
of the Tony M-Southwest deposit or on the Copper Bench-Indian Bench deposit
located further north.

79

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Energy Fuels has carried out no exploration work on the Henry
Mountains Complex.

Mineralization

Uranium mineralization in the Henry Mountains Complex is hosted
by favorable sandstone horizons containing detrital organic debris.
Mineralization primarily consists of coffinite, with minor uraninite which
usually occurs in close association with vanadium mineralization. Mineralization
occurs as intergranular disseminations, as well as coatings and/or cement on and
between sand grains and organic debris. Vanadium occurs as montroseite (hydrous
vanadium oxide) and vanadium chlorite in primary mineralized zones located below
the water table (i.e., the northern portion of the Tony M deposit). Historic
production records from the AEC for the South Henry Mountains district suggest
that the vanadium content of the district is relatively low. Based on the review
of the available analyses, RPA is of the opinion that the
V2O5:U3O8 ratio ranges from
about 1.3:1 to about 2.0:1 in the Henry Mountains Complex deposits.

The Henry Mountains Complex vanadium-uranium deposits consist
of two extensive elongate, tabular zones containing a large concentration of
mineralization. The Tony MSouthwest deposit extends for a distance of
approximately 2.5 miles along a north-south trend and has a maximum width of
about 3,000 ft. The larger Copper Bench-Indian Bench deposit extends
approximately 3.5 miles along a northwesterly trend to the northeast of the Tony
MSouthwest deposit.

Present Condition of the Property and Work Completed to Date

The following section has been prepared by the Company and
is not based exclusively on the Henry Mountains Technical Report.

The Tony M Property was developed from 1977 to 1983 with a
double entry system including two parallel declines spaced 50 ft. apart. The
declines measure 9 feet by 12 feet in cross- section, have crosscuts on 50 foot
centers, have a minus 3% grade, serve as the primary fresh air intake, and are
10,200 feet in length. By January 31, 1983, over 18 miles of underground
workings had been developed at the Tony M Property. The underground workings were allowed to flood after
mining activities were suspended in 1984. The southern one-half of the
underground workings remained dry, as they are located above the static water
table.

The underground workings were planned as a random room and
pillar approach with pillar extraction by a retreat system. Mining equipment
consisted of slushers and rubber-tired, five- to ten-ton capacity load-haul-dump
units. Exhaust ventilation was provided by five bored ventilation shafts, six
feet in diameter, each with a 75-HP exhaust fan mounted at the shaft collar.

By early 2007, work on reactivating the Tony M Property was
carried out by Denison, and surface and underground rehabilitation and repairs
were conducted. Surface facilities to support mining activities were
constructed, including administration and maintenance facilities, site power and
communications, and an evaporation pond for evaporation of water from the
underground workings. Worker housing was established in the town of Ticaboo,
Utah. As rehabilitation work advanced, ventilation was
re-established. The water level in the underground workings had risen to
historic pre-mining activity levels, and upon reaching the flooded workings,
dewatering activities were also initiated. During the rehabilitation work,
limited amounts of cleanup mineralized material were removed. As areas of the
underground workings were made ready for mining activities, extraction of
mineralized materials increased steadily. Dewatering continued at an average
rate of 125 gallons per minute during these activities. Denison placed the Tony
M Property on temporary closure status at the end of November 2008. The project
is being maintained in a state ready to resume operations as market conditions
warrant. Staff have been retained at the site to keep the property in a ready
state.

There is no existing infrastructure on the Bullfrog Property.

The Henry Mountains Complex was acquired by the Company in June
2012, through the acquisition of the  US Mining Division from Denison. The cost of the
Henry Mountains Complex has been fully impaired, and as of December 31, 2015, the total cost attributable to the Henry Mountains
Complex and its associated equipment on the financial statements of the Company
was nil.

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The Companys Planned Work

The Company intends to continue its evaluation activities at
the Bullfrog Property during 2016. The Company is also conducting care and
maintenance activities on the Tony M Property, in order to maintain it on
standby, pending improvements in uranium prices.

Mineral Resource Estimates

Mineral Resources of the Tony M-Southwest deposit were
estimated by Denison in 2009 using the GT contour method, and Mineral Resources
of the Copper Bench-Indian Bench deposit were estimated in 1993 by EFN using the
polygonal block method.

The Mineral Resources were classified under the Indicated and
Inferred categories under NI 43-101. They are reported at a cut-off grade of
0.10% eU3O8 over a minimum thickness of 2 feet and minimum
GT (grade times thickness product) of 0.2 feet % eU3O8 for
the Tony M- Southwest deposit and at a cut-off grade of 0.20%
eU3O8 over a minimum thickness of 4 feet and minimum GT
(grade times thickness product) of 0.8 feet % eU3O8 for
the Copper Bench-Indian Bench deposit. These Mineral
Resources are not reserves within the meaning of SEC Industry Guide 7.

Henry Mountains Complex Mineral Resource
Estimates(1) (2) (3)

Deposit
    Category(1)
    Tons (million)
    Grade eU O (%)
    Contained
      eU3O8(million
      pounds)3 8Tony M (2)
    Indicated
    1.03
    0.24
    4.83Southwest(2)
    Indicated
    0.66
    0.25
    3.30Indian Bench(3)
    Indicated
    0.22
    0.40
    1.74CopperBench(3)
    Indicated
    0.50
    0.29
    2.93Total
    
    2.41
    0.27
    12.80Tony M
    Inferred
    0.65
    0.17
    2.17Southwest
    Inferred
    0.21
    0.14
    0.58Indian Bench
    Inferred
    0.25
    0.42
    2.09Copper Bench
    Inferred
    0.50
    0.32
    3.24Total
    
    1.61
    0.25
    8.08


Notes:

|(1) | The Mineral Resource estimates comply with the
      requirements of NI 43-101 and the classifications comply with CIM
      definition standards and are not reserves under SEC Industry Guide 7.
      Mineral resources that are not  reserves do not have demonstrated
      economic viability. See Cautionary Note to U.S. Investors Concerning
      Disclosure of Mineral Resources above.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The Tony M and Southwest Mineral Resources were estimated
      at a cut-off grade of 0.10% eU3O8 over a minimum
  thickness of 2 feet and a minimum GT of 0.2 feet-%.                                                                                                                                                                                                                              
|(3) | The Indian Bench and Copper Bench Mineral Resources were
      estimated at a cut-off grade of 0.20% eU3O8, a
      minimum thickness of 4 feet and a minimum GT of 0.8 feet-% that does not
      include any intervals with less than a 0.5 foot intercept of 0.08%
      U3O8.                                                                                                                   

The EFN resource estimate was audited by RPA and accepted as a
current Mineral Resource estimate for Energy Fuels under NI 43-101.

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The La Sal Project



Unless stated otherwise concerning land tenure and permitting
efforts, the following technical and scientific description of the La Sal
Project is derived from a technical report titled "Technical Report on La Sal
District Project (Including the Pandora, Beaver, and Energy Queen Projects), San
Juan County, Utah, U.S.A.", dated March 25, 2014, prepared by Douglas C. Peters,
CPG, of Peters Geosciences, in accordance with NI 43-101 (the La Sal
Technical Report). The La Sal Technical Report includes an updated NI
43-101 compliant Mineral Resource estimate. The author of the La Sal Technical
Report is a qualified person and independent of the Company within the
meaning of NI 43-101. A copy of the La Sal Technical Report is available on
SEDAR at www.sedar.comand onEDGAR atwww.sec.gov. The La
Sal Project does not have known reserves, and is therefore considered under SEC
Industry Guide 7 definitions to be exploratory in nature, despite uranium
extraction activities occurring as recently as 2012.

Project Description & Location

The La Sal Project is an underground project that consists of
four mineral properties within close proximity of one another, including (from
east-to-west) the Pandora (Snowball) Property, the Beaver (La Sal) Property, the
Redd Block Property, and the Energy Queen Property. The La Sal Project is
located in San Juan County, Utah near the town of La Sal. Other properties
within the La Sal Project (but not described in the La Sal Technical Report)
include the Pine Ridge property, east of the Pandora property, and unpatented
mining claims west of the Energy Queen Property.

The La Sal trend, which includes the La Sal Project, has a long
history of uranium and vanadium production. Deposits from this district have
been successfully milled at several historic mills in the region including Union
Carbides (Umetco's) mill at Uravan, Colorado, the Climax Uranium mill in Grand
Junction, Colorado, the Atlas mill at Moab, Utah and Energy Fuels White Mesa
Mill near Blanding, Utah.

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Operations at the La Sal Project are currently on standby. The
extraction of all resources at the La Sal Project have been by conventional
underground methods for over 40 years and, once mining activity resumes, will
continue by such methods. These methods have been used very successfully in the
region for over 100 years. The nature of the Salt Wash uranium-vanadium deposits
require a random room and pillar mining configuration. The deposits are accessed
from the surface via declines depending on the depth to mineralization and
geologically suitable sites for portals, as is the case for the La Sal and
Pandora/Snowball Properties. Deposits may also be accessed through vertical
shafts, such as the shafts located at the Beaver and Energy Queen Properties.
The Salt Wash uranium deposits are usually thinner than the underground height
needed for personnel and equipment access. Therefore, the mineralized material
is often extracted by employing a split-shooting method, which serves to
separate mineralized material and waste as it is broken.



Accessibility, Climate, Local Resources, Infrastructure, and
Physiography

The La Sal Project is easily accessed from the all-weather Utah
State Highway 46. Utah 46 enters the project land near the southwest corner of
ML-49313 (Section 36, T28S, R24E) about three miles east of the intersection of
Utah 46 with U.S. Highway 191 at La Sal Junction. Utah 46 stays within or very
near the project land for the next 9 miles to the east. All State and U.S.
highways in this area are paved roads.

The area is semi-arid. Temperatures range between an average
low of 41°F to an average high of 72°F. Less than ten
inches of precipitation falls per year. Winters are not severe, although there
are numerous snow storms, the temperature drops below 0°F at times,
and snow can accumulate to over a foot in the lower areas and more than two feet
at times on Pine Ridge. The region of the La Sal Project central area is
characterized by a broad shallow valley of hay fields and pasturelands at an
elevation between 6,400 and 7,000 feet. Hills cut by small canyons occur at the
west end and even higher elevations of about 7,800 feet are reached at Pine
Ridge on the east end. All elevations within four miles of the center and west
end of the property support moderate growths of sage and rabbitbrush along with
other brush, forbs, cactus, yucca, and grasses. Higher elevations contain
juniper and piñon pine in the rocky soils along with scrub oak, aspen, and
ponderosa pine on Pine Ridge to the east.

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La Sal, Utah is a small town, currently home to about 200
people. It has been a hub to area ranchers, uranium and copper miners, and oil
and gas workers for many years. Larger population centers of Moab and
Monticello, Utah are 22 miles north and 34 miles south, respectively, from La
Sal Junction on Highway 191. Before the cessation of mining activities at the
Beaver and Pandora Properties in late 2012, many of the workers also came from
the Nucla-Naturita and the Dove Creek areas of Colorado, each about 55 miles
away to the east and south, respectively. Larger cities with industrial supply
houses include Cortez, Colorado about 100 miles to the south and Grand Junction,
Colorado about 140 miles to the north.

Electric transmission and distribution lines exist throughout
the project area, of sufficient size to supply the load the projects demanded in
the past. Several substations exist, and the electricity supply is adequate for
additional demand. Natural gas is also available for any future production
needs.

Ownership

The La Sal Project is held by Energy Fuels subsidiary, EFR
Colorado Plateau LLC under private surface use and access leases, private
mineral leases, Utah State Mineral Leases, San Juan County surface use, access,
and mineral lease, and, after the Company reduced the property position by
dropping claims without affecting the Mineral Resource, 219 unpatented mining
claims on land managed by the BLM or USFS, that are either owned by Energy Fuels
(90 claims) or leased by Energy Fuels (129 claims). After the claim drop, the
total land package now consists of approximately 9,260 acres. The unpatented
claims cover about 3,350 acres, the seven Utah State leases total approximately
2,220 acres, the San Juan County leased land contains just over 263 acres, and
the six separate surface access and nine private parcel mineral leases apply to
a total of 3,430 acres. The property covers all, or parts of the following
Sections: Sections 31, 32, and 33, T28S, R25E; Sections 4, 5, 6, and 7, T29S,
R25E; Sections 25, 26, 31, 32, 33, 34, 35, and 36, T28S, R24E; Sections 1, 2, 3,
4, 5, 6, 7, 11, and 12, T29S, R24E; Section 36, T28S, R23E; and Sections 1, and
12, T29S, R23E, SLBM, San Juan County, Utah.

Annual holding costs consist of rental fees to the BLM at $155
per year per claim, due on or before September 1st each year. An affidavit of
the payment to the BLM must be filed with the appropriate County each year for a
nominal fee of about $10 per claim. This applies to all unpatented claims
whether owned or leased by Energy Fuels. Annual holding costs for State leases
and private leases vary, ranging between $500 and $13,500 for State Leases and
$480 and $20,340 for private leases. The Company is also required to pay
production royalties at varying rates for unpatented mining claims and private
leases. The Utah State production royalties are fixed at 8% on uranium and 4% on
vanadium.

The Company generally has entered into surface access
agreements sufficient to allow access for its mining activities.

Permitting

Mineral extraction facilities on private and state lands
require an approved Notice of Intent (NOI) with the Utah Division of
Oil, Gas and Mining (UDOGM). If the facility generates water, a ground
water discharge permit is required for the treatment plant and ponds, and a
surface water discharge permit is required for discharge of treated water. Both
permits are issued through the State of Utah Division of Water Quality. Air
permits for air emissions including radon are issued by the Utah Division of Air
Quality (DAQ); however, smaller mines are typically exempt. Water well
permits, water rights, and stream alteration permits are issued through the
Division of Water Quality (DWQ). On federal land, all the state permits
listed above are required; however, a PO and a review under NEPA are also
required by the federal land managing agency.

The Companys mineral facilities at the La Sal Project are all
existing facilities in historic mining areas, and approvals by the BLM and USFS
have been obtained under EAs and Findings of No Significance (FONSIs) under NEPA. The Energy Queen and Redd
Block IV Properties are located on private land and were permitted with UDOGM in
the early 1980s by Union Carbide. The Energy Queen Property was developed and
has conducted
mineral extraction, but the Redd Block IV Property was discontinued soon after
the start of construction. A mine and reclamation plan amendment for the Energy
Queen Property was approved by the UDOGM on September 22, 2009. This amendment allows the
Company to install water treatment and other new surface facilities to support
extraction of up to 250 tons per day (tpd) of mineralized materials.
Water discharge permits to allow initial and ongoing discharge of water from
underground workings were also approved by the DWQ in 2009. Energy Fuels
initiated permitting plans for additional facility expansion in 2012, but then
deferred these plans when the Redd Block IV resource was acquired in the Denison
acquisition. Engineering studies are being conducted to determine if the
Redd Block IV resource can be extracted from the Energy Queen shaft and surface
facilities. If this proves to be the case, the Energy Queen UDOGM permit would
be updated to include the Redd Block IV area as well as other resources that
have been acquired since the 2009 amendment. A Small Source Exemption that is in
place for air emissions would also need to be replaced with an air permit
because of the increased surface disturbance.

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The Pandora, Beaver, La Sal and Snowball Properties are
permitted with the State of Utah, the BLM, and the USFS for current operations.
Energy Fuels is in the process of obtaining combined permits for expansion of
the Pandora, Beaver, and La Sal Properties through the UDOGM and BLM/USFS. Both
permit amendments are in the late stage of permitting. In late-2014, the final
EA and draft Decision Notice and FONSI were issued for public comment and
opportunity to object through the USFS. In March 2015, in response to an
objection filed by the Western Mining Action Project, the USFS Objection Review
Officer issued an objection resolution letter that required improvements to be
made to the EA and project record prior to issuance of the Decision Notice. The
required improvements are being addressed, with issuance of a final revised EA
for the La Sal Project by the BLM and USFS anticipated in mid-to late-2016. All
other permits needed for project expansion, including the required air permit,
are in place.

Geologic Setting

The Colorado Plateau covers nearly 130,000 square miles in the
Four Corners region of the U.S. The La Sal Project and other properties held by
Energy Fuels lie in the Canyon Lands Section in the central and east-central
part of the Colorado Plateau in Utah and Colorado. The Colorado Plateaus
basement rocks are mostly Proterozoic metamorphics and igneous intrusions. The
area was relatively stable throughout much of the Paleozoic and Mesozoic Eras
with minor uplifts, subsidences, and tiltings resulting in fairly flat-lying
sedimentary rocks ranging from evaporites, limestones, and marine clastic
sediments, through eolian sandstones, to detritus of fluvial systems.

The significant uranium deposits in the La Sal Project occur in
the late Jurassic Morrison Formation. The Morrison comprises two members in the
La Sal area. The lower member, the Salt Wash, is the main uranium host. The
upper part of the Morrison is the Brushy Basin Member; it is from 350 to 450
feet thick. The Salt Wash, approximately 300 feet thick, consists of about equal
amounts of fluvial sandstones and mudstones deposited by meandering river
systems flowing generally toward the east. The Brushy Basin was deposited mostly
on a large mud flat, probably with many lakes and streams. Much of the material
deposited to form the Brushy Basin originated from volcanic activity to the
west. The majority of the recovered uranium has come from the upper sandstones
of the Salt Wash Member known as the Top Rim (historically referred to as the
ore-bearing sandstone or OBSS), which ranges from about 60 feet to 100 feet
thick.

Light-brown and gray sandstones and conglomerates of the
200-foot thick Cretaceous Burro Canyon Formation overlie the Brushy Basin. These
crop out in the eastern part of the La Sal Project (over the Pine Ridge,
Pandora, and La Sal/Snowball properties). This formation contains interbedded
green and purplish mudstones with a few thin limestone beds. The Burro Canyon
Formation is exposed covering the Brushy Basin at the west end of the La Sal
Project, on the State sections and claims west of the Energy Queen. Locally,
silicification altered the limestones to chert and some of the sandstones to
orthoquartzite. Orthoquartzite cobbles and boulders litter the Brushy Basin
slopes. In the central part of the La Sal Project (Beaver, Redd Block, and
Energy Queen), the Burro Canyon is covered by a layer of alluvium and gravels
shed from the La Sal Mountains to the north. These gravels vary in thickness
from a thin veneer to over 120 feet thick.

The La Sal District uranium-vanadium deposits are similar to
those elsewhere in the Uravan Mineral Belt. Host rocks within the areas
surrounding the La Sal Project consist of oxidized sediments of the Morrison
Formation, exhibiting red, hematite-rich clastic rocks. Individual deposits are
localized in areas of reduced, gray sandstone and gray or green mudstone (Thamm,
et al., 1981). The Morrison sediments accumulated as oxidized detritus in the
fluvial environment. However, there were isolated environments where reduced
conditions existed, such as oxbow lakes and carbon-rich point bars. During early
burial and diagenesis, the through-flowing ground water within the large,
saturated pile of Salt Wash and Brushy Basin material remained oxidized, thereby
transporting uranium in solution. When the uranium-rich waters encountered the
zones of trapped reduced waters, the uranium precipitated. Therefore, deposits
vary greatly in thickness, grade, size, and shape. Vanadium may have been
leached from iron-titanium mineral grains and subsequently deposited along with,
or prior, to the uranium.

History

Numerous underground mines near outcrops in the eastern part of
the La Sal trend (in the La Sal Creek Canyon District) were mined for vanadium
during the early 1900s. Sometime after World War II (approximately 1948-1954), exploration work on Morrison Formation outcrops in the
west end of the district resulted in the discovery of the Rattlesnake mine (open
pit) two miles west-southwest of the Energy Queen shaft. Deeper deposits of the
central La Sal trend (in the area of the La Sal Project) were discovered in the
1960s and developed for production in the 1970s through vertical shafts and
declines. The La Sal Project and La Sal Creek District production, through 1980,
amounted to about 6,426,000 pounds U3O8 (average grade of
0.32% U3O8) and nearly 29,000,000 pounds V2O5 (average
grade of 1.46%). Most production in the district was derived from fluvial
sandstones, mainly in the upper part of the Salt Wash Member of the Morrison
Formation of Jurassic age.

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The Pandora Property was operated by Atlas Minerals in the
1970s and early 1980s. Umetco Minerals (Union Carbide) operated the Snowball, La
Sal, and Beaver properties during the same time period. The Energy Queen
property, then known as the Hecla Shaft, was started in 1979 by the Union
Carbide/Hecla Joint Venture. The Energy Queen stopped mining activities in 1983
due to inadequate uranium prices. GEUMCO (General Electric Uranium Mining
Company) operated the Pine Ridge property in the late 1970s, producing from a
sandstone lens in the Brushy Basin Member of the Morrison Formation. Pine Ridge
was acquired by Minerals Recovery Corporation in 1981 which developed a decline
to the Salt Wash Member of the Morrison Formation, but halted mining activities
before any significant extraction of mineralized materials. A small project
conducted mining activities in the eastern part of Section 2 (ML-49596) during
the early 1980s. The amount of uranium extracted from this project is unknown.
Low uranium and vanadium prices forced all mining activities throughout the
district to cease about 1991. Mineralized materials from these projects have
been successfully processed at the Companys currently operating White Mesa
Mill, and the now dismantled Uravan Mill (Umetco) and Moab Mill (Atlas).

Denison (previously named International Uranium Corporation, or
IUC) began mining activities at the Pandora Property in 2006 and later
from the Beaver shaft and La Sal decline. The extraction by Denison, and Energy
Fuels, following its acquisition of Denisons US assets, between 2006 and 2012,
at the Pandora Property was 290,000 tons of mineralized material. The production
by Denison and Energy Fuels between 2006 and 2012 from all of the facilities in
the La Sal Project area was 412,000 tons of mineralized material (1,658,000
pounds U3O8 at an average grade of 0.20%
U3O8 and 8,431,000 pounds V2O5at an average grade of 1.02%
V2O5).

From 2008 through mid-2012, Denison drilled 225 exploration and
fill-in (confirmation) holes in the project area. Energy Fuels drilled another
27 holes on the Energy Queen Property and the State land to the northwest of the
Energy Queen Property from 2007 through 2012. Due to declining uranium prices,
mining activities ceased in October 2012 at the Beaver/La Sal Property and in
December 2012 at the Pandora Property. Both projects were put on a standby
status and are currently maintained in conditions that would allow them to be
placed back into production within a few months time.

The Company owns the data on some 2,200 drill holes within the
boundary of the property held as the La Sal Project.

Mineralization

The uranium- and vanadium-bearing minerals occur as fine
grained coatings on the detrital grains. They fill pore spaces between the sand
grains, and they replace some carbonaceous material and detrital quartz and
feldspar grains. The primary uranium mineral is uraninite (pitchblende)
(UO2) with minor amounts of coffinite (USiO4OH).
Montroseite (VOOH) is the primary vanadium mineral, along with vanadium
clays and hydromica. Traces of metallic sulfides occur. In outcrops and shallow
oxidized areas of older mines in the surrounding areas, the minerals now exposed
are the calcium and potassium uranyl vanadates, tyuyamunite, and carnotite.

Some stoping areas in the Beaver/La Sal and Pandora/Snowball
Properties are well over 1,000 feet long and several hundred feet wide. The
Indicated Mineral Resources of the Redd Block and Energy Queen Properties
identified through drilling are of similar size. Individual mineralized beds
vary in thickness from several inches to over 6 feet. Throughout much of the La
Sal district there are three horizons in the Top Rim that host the
mineralization. They are 25-40 feet apart.

Kovschak and Nylund (1981) report no apparent disequilibrium
problems in the other mining episodes of the La Sal area. Mining activities and
milling by Denison and Energy Fuels shows that well-calibrated gamma probes
equate well to the mill head grades indicating no significant disequilibrium
exists. This is generally true of the Salt Wash uranium deposits because of the
age of the mineralization and the hydrologic history of the host rocks.
Therefore, Energy Fuels has no reason to anticipate any disequilibrium
conditions within the unmined portions of the deposits on the project property.

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Present Condition of the Property and Work Completed to Date

Permanent structures existing at the Energy Queen Property
include the headframe and a metal building containing an office, shop, showers,
warehouse, and the hoist. The compressor is located in a separate building. One
cased vertical ventilation hole was established into the underground working
level. A small water treatment building and settling ponds are located on the
San Juan County land in Section 5. In the past, water was treated with barium
chloride to remove radium.

The Beaver and La Sal Properties are accessed through the La
Sal decline with rubber-tired equipment. The principal shop, offices, and
warehouse facilities used by all properties in the district are housed at the
surface facilities of the La Sal decline. There are large fenced yards, as well
as buildings for equipment and supply storage. It is used as a central receiving
site for bulk and large orders which are then distributed to the other Energy
Fuels properties in the district and other parts of the region. The shop areas
include facilities specific to electrical equipment, drills, mobile diesel
equipment, and welding. Engineering, geology, safety, environmental, and
supervisory and clerk offices are located here. There are also staff and
underground crews dry rooms. Ample stockpile space is available for easy truck
load-out for transporting mineralized material to the White Mesa Mill.
Electrical lines and substations exist and are adequately sized for any future
extraction potential of the Mineral Resources. The La Sal Project is dry, so no
water treatment facilities are needed.

The surface infrastructure at the Beaver shaft location
consists of the hoist house, hoist, and headframe. The shaft is 690 feet deep to
the underground haulage level at the loading pockets top grizzlies, and 750 feet
total depth. There are three pockets, two of 70-ton capacity and one of 90-ton
capacity. This arrangement allows for separation of mineralized material and
waste. The skips dump into a bin from which the mineralized material is trucked
a short distance to a stockpile and subsequently loaded in to the trucks for
haulage to the White Mesa Mill. The shaft conveyance system is certified for man
trips, although the routine access for personnel is through the La Sal decline.
Another building houses the compressors which supply compressed air for the
underground workings in the Beaver Project. Power lines and substations are in
place. The Beaver Property is dry underground; therefore, no water treatment
facilities exist.

Access into the Pandora Property is through a decline with
rubber-tired equipment. Surface facilities here are less than at the other
projects. It consists of a small office and shop buildings. A third building
with a dirt floor is used for storage of materials and equipment. Power lines
exist to the property with enough capacity for the required load of potential
future mining activities. The Pandora Property is dry underground.

In 1980, Umetco was planning to sink another shaft to access
the Redd Block Mineral Resources. The project did not progress far. The
infrastructure at the Redd Block Property associated with a possible new shaft
consists of a cleared and leveled site large enough for future construction of
all surface facilities that would be required. The power line and transformers
are installed, and the concrete base for a compressor building has been poured.
As mining activities progress, a water table in the Salt Wash sandstone host
horizon will be between the current Beaver Property western underground workings
advance and the east end of the Redd Block Mineral Resources. Seven monitor
wells were installed by Denison around this proposed shaft site.

A total of three surety bonds, totalling $532,197 have been
posted with regulatory authorities to secure reclamation at the various project
facilities.

The Company acquired the Energy Queen Property in December
2006. The remainder of the La Sal Project, was acquired by the Company in June
2012, through the acquisition of the Denison US Mining Division. The cost of the
La Sal Project has been fully impaired, and as of December 31, 2015, the total
cost attributable to the La Sal Project and its associated equipment on the
financial statements of the Company was nil.

The Companys Planned Work

The Company intends to continue its permitting and related
activities at the La Sal Project during 2016, as described in subsection
Permitting above. The Company is also conducting care and maintenance
activities on the facilities at the various properties within the La Sal
Project, in order to maintain them on standby, pending improvements in uranium
prices. Energy Fuels has evaluated numerous targets for additional surface
drilling at the La Sal Project. However, there are no plans to perform the
drilling in 2016.

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Mineral Resources

Since the La Sal Project covers a length of ten miles and
includes several project sites and facilities, the La Sal Project was divided
into four blocks: Pandora, Beaver/La Sal, Redd Block and Energy Queen. The
mineral resource estimation for the La Sal Project is based on the gamma logs
from 1,993 historic rotary drill and core holes, 247 holes drilled by Energy
Fuels and Denison from 2007 to 2012, and approximately 500 underground long
holes. Mineral Resource estimates have been calculated using a modified
polygonal method. A minimum composite intercept GT value (grade X thickness) of
0.10% feet eU3O8 was used as a cutoff. The cutoff of a
mineralized intercept in individual holes is 0.10% U3O8,
with a select few holes as low as 0.05% U3O8. Mining
assumptions were used in determining a cut-off grade for the resource estimates.
The mineralization in the La Sal Project is interpreted as being hosted in the
Top Rim sandstone of the Salt Wash Member of the Morison Formation. Total
thickness of the host sandstone is between 60 and 100 feet.

Mineral Resource estimates have been made for the La Sal
Project. The Mineral Resources are classified as defined in the National
Instrument 43-101 and in accordance with CIM Standards on Mineral Resources and
Mineral Reserves. They are grouped by logical mining unit subareas and
summarized in the table below. The Mineral Resource estimates comply with the
requirements of NI 43-101 and the classifications comply with CIM definition
standards. See Cautionary Note to U.S. Investors Concerning Disclosure of
Mineral Resources above.

Properties
    Tons
    U3O8**Lbs.**
    Avg.
      **Grade(**U3O8**)**
    V2O5Lbs.
    Avg. Grade(
      V2O5)(1)Energy QueenMeasured
    262,000
    971,000
    0.19
    5,100,000
    0.97Indicated
    81,000
    268,000
    0.17
    1,409,000
    0.87Inferred
    43,000
    79,000
    0.09
    417,000
    0.48Redd BlockMeasured
    336,000
    1,260,000
    0.19
    6,615,000
    0.98Indicated
    35,000
    47,000
    0.07
    249,000
    0.35Inferred
    95,000
    171,000
    0.09
    900,000
    0.47Beaver/La SalMeasured
    215,000
    800,000
    0.19
    4,199,000
    0.98Indicated
    9,000
    33,000
    0.18
    173,000
    0.96Inferred
    29,000
    67,000
    0.11
    352,000
    0.60PandoraMeasured
    196,000
    701,000
    0.18
    3682,000
    0.94Indicated
    6,700
    19,000
    0.14
    99,000
    0.73Inferred
    18,000
    44,000
    0.12
    232,000
    0.66Total(Mea+Ind)(2)
    1,142,000
    4,100,000
    0.18
    21,525,000
    0.94Total(Inf)
    185,000
    362,000
    0.10
    1,902,000
    0.51


| | (1) | The average
      V2O5:U3O8 ratio from both
      Pandora and Beaver/La Sal mines is 5.25:1 from the recent Energy Fuels
      White Mesa Mill head grades, and this ratio is used for the Vanadium
  Mineral Resources estimate.                                                                
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                   
| | (2) | The foregoing resources have been calculated in
      accordance with NI 43-101 and are not reserves within the meaning of SEC
      Industry Guide 7. Mineral resources that are not reserves do not have
      demonstrated economic viability within the meaning of SEC Industry Guide
      7.

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The Daneros Project



Unless otherwise stated concerning land tenure and permitting
efforts, the following scientific and technical description of the Daneros
Project is derived from a technical report titled The Daneros Mine Project, San
Juan County, Utah, U.S.A., dated July 18, 2012, prepared by Douglas C. Peters,
Certified Professional Geologist, of Peters Geosciences, Golden, Colorado in
accordance with NI 43-101 (the Daneros Mine Technical Report). The
author of the Daneros Mine Technical Report is a qualified person and is
independent of the Company within the meaning of NI 43-101. The Daneros Mine
Technical Report is available on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov.The Daneros Project does not have known reserves, and is
therefore considered under SEC Industry Guide 7 definitions to be exploratory in
nature, despite uranium extraction occurring as recently as 2012.

Project Location and Description

The Daneros Project is an underground project located in the
Red Canyon portion of the White Canyon District, Utah, approximately 65 miles
west of the White Mesa Mill. The Company holds a 100% interest in various groups
of mining claims, including Daneros and adjoining historical sites which can be
developed in conjunction with the Daneros Project.

The previous owner of the Daneros Project, Utah Energy
Corporation (UEC), gathered the necessary environmental data and
obtained the approvals to open an underground uranium project in May 2009. UEC
commenced active mining activities, including constructing a decline into the
main Daneros deposit. The first loads of mineralized material from the Daneros
Project were delivered to the White Mesa Mill in December 2009, and a toll
milling campaign was conducted in the second half of 2010. The Daneros Project
was acquired by the Company in June 2012 along with all of Denisons U.S.
Mining Division. Prior to being placed on standby in October 2012, mineralized
material from the Daneros Project was delivered to the White Mesa Mill and
processed for Energy Fuels account.

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The extraction of all resources in the Daneros Project is by
conventional underground methods. These methods have been used successfully in
the region for over 70 years. The nature of the Shinarump uranium deposits
requires a random room and pillar mining configuration. The deposits have
irregular shapes and occur within several close-spaced, flat or slight-dipping
horizons. Uranium mineralization often rolls between horizons. The use of
rubber-tired equipment allows the workers to follow the mineralized material
easily in the slight dips and to ramp up or down to the other horizons. The
deposit is accessed from the surface through a 450 feet decline at a gradient of
-15%. The Shinarump deposits are usually thinner than the underground height
needed for personnel and equipment access. Therefore, the mineralized material
is extracted by a split-shooting method. The project also employs an underground
long-hole exploration drilling program, reaching out as much as 400 feet ahead
of and adjacent to the workings, as guided by the project geologist.

Accessibility, Climate, Local Resources, Infrastructure and
Physiography

The Daneros Project is located 4.8 miles from Fry Canyon, Utah
and is accessed via Radium King Road, which is maintained by San Juan County,
approximately 14 miles south of Utah Highway 95.  The bench
above the project facilities, where past drilling also had been conducted, is
accessed by a dirt road connecting to the project access road south of the
underground workings portal area. Electric power is generated on site. The
shipping distance from the Daneros Project to the White Mesa Mill is about 65
miles.

The semi-arid climate of the White Canyon area is characterized
by large daily and yearly temperature ranges and total annual precipitation of
approximately 10 to 16 inches, mostly as sporadic, intense summer thunderstorms
typical of the Colorado Plateau region. Winter snowfall is moderate and rarely
stays on the ground very long. Weather conditions pose no impediment to year
round work on the project.

Apart from previous mining activities, the only commercial land
use purposes are cattle grazing and tourism activities such as hiking and
mountain biking. Due to a shortage of water and thin soils, much of the White
Canyon area is unsuitable for agriculture.

The project area is remotely located relative to water and
power infrastructure. Housing for workers is mostly in camp trailers in Fry
Canyon, or they commute from Blanding, Utah 65-miles to the east or farther.
Blanding is a town large enough to host regional industrial activities,
including stores and supply houses of sufficient size and inventory to meet most
of the needs of an operation the size of the Daneros Project.

The project area is located along a north-south trending canyon
which is a tributary to Red Canyon, also known as Bullseye Canyon. The Red
Canyon drainage flows westerly for approximately 25 miles to the Colorado River
where it joins Lake Powell at the head of Good Hope Bay. The project portal area
comprises steeply sloping, rocky ground and scree along the eastern slope of
Bullseye Canyon. Very steep to vertical, and at times overhanging, cliffs 400
feet high rise from the slope about 250 feet above the portal.

Vegetation in the project area consists of sagebrush, juniper
and piñon in the hills and slopes, while desert grasses, forbs, and shrubs are
evident within the valley floors and on the mesa tops. Elevations in the region
range from about 5,300 feet at the Fry Canyon townsite to over 7,000 feet on the
surrounding mesa tops. The project portal is at about 5,750 feet above sea
level.

Ownership

The Daneros Project is owned by the Companys subsidiary EFR
White Canyon Corp. Since the Daneros Project Technical Report was written, the
Company has reduced the property position around the periphery of the project,
without affecting the Mineral Resource as described in the Daneros Project
Technical Report. We have also added a Utah State mineral lease of 640 acres in
Section 32, T36S, R16E to the project which is not included in the technical
report.

The property now consists of 141 unpatented mining claims
located on federal land administered by the BLM in San Juan County, Utah, plus
the State lease totaling approximately 3,450 acres. The property lies in
Sections 1, (11, and 12 were dropped in 2014) T37S, R15E, SLM, Sections (4
dropped in 2014), 5, 6, 7, 8, (10, 11, 15, 17 dropped in 2014), and 18, T37S,
R16E (and Section 31 and 33, T36S, R16E dropped in 2014).

90

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The mining claims are maintained by making annual payments of
US $155 per claim per year to BLM due September 1st each year, along with a
nominal filing fee paid to the county within 30 days of the BLM filing of about
$10 per claim. Work expenditures are not required. Holders of unpatented mining
claims are generally granted surface access to conduct mineral exploration and
mining activities. However, additional mine permits and plans are generally
required prior to conducting exploration or mining activities on such claims.

A number of the claims bear production royalties. Claims
hosting the Daneros deposit are subject to royalties ranging between 15% of
"market value" of the mineralized material and 2.5% of gross proceeds as
described in further detail in the Daneros Mine Technical report. Other claims
are owned by the Company without encumbrances. The State lease added since the
Daneros Project Technical Report carries the standard Utah royalty of 8% on
uranium and 4% on vanadium.

Sufficient surface rights are in place for contemplated mining
activities and waste storage. Since no milling activities are contemplated on
the Daneros Project, no areas are required for tailings storage, heap leach
pads, or processing plant sites.

Permitting

The primary permits required for mining activities at the
Daneros Project include a Large Mine NOI issued by UDOGM and a PO approved by
the BLM. The PO required document preparation and public notice of an EA. The
permits obtained by UEC were for the initial stage of mining activities and
contemplated eventual expansion of the mining activities, with the inclusion of
additional surface area for support facilities. The Daneros Project does not
discharge any water, so no discharge permit is required.

Following approval of the PO by the BLM, an appeal of the BLM
approval was filed by Uranium Watch and associated non-government organizations.
The appeal was ultimately denied by the Utah BLM State office, and appealed to
the Department of Interior Board of Land Appeals, which denied the appeal on
September 26, 2012.

Permitting for project expansion began in 2012 with the
submittal of a construction application to the Utah Division of Air Quality
(UDAQ) and EPA for radon emissions. This application, which was
approved in 2nd Quarter 2012 requires monitoring and annual reporting
of radon emissions from the projects ventilation system. An air permit
application was submitted to UDAQ for other regulated air emissions (e.g.,
fugitive dust, volatile organic compounds) and approved in 4th
Quarter 2012. In 1st Quarter 2013, an amended PO and a Large Mine NOI
were submitted to the BLM and UDOGM, respectively. An EA is currently being
conducted for the proposed Project expansion. The Company expects these
amendments to be approved in  late 2016.

Exploration Notices have also been approved for brown fields
drilling around the Daneros Project. These notices cover the Daneros and the
Lark and Royal claim areas. Energy Fuels is reviewing plans for additional
surface drilling in the Daneros Project area.

A surety bond totalling $81,120 has been posted with regulatory
authorities to secure reclamation at the Daneros Project.

Geological Setting

Major uranium deposits of the east-central Colorado Plateau
district occur principally in two fluvial sandstone sequences. The older is
located at or near the base of the Upper Triassic Chinle Formation and the other
occurs in the Late Jurassic Salt Wash Member of the Morrison Formation. The main
uranium-bearing unit at the Daneros Project and throughout the White Canyon
district is the fluvial Shinarump Member, a basal, sandstone-conglomerate
sequence deposited in a complex stream system which unconformably overlies and
locally scours into oxidized sedimentary units of the Moenkopi Formation.

The Shinarump Member consists of predominantly
trough-crossbedded, coarse-grained sandstone and minor gray, carbonaceous
mudstone and is interpreted as a valley-fill sequence overlain by deposits of a
braided stream system. Uranium mineralization appears to be related to
low-energy depositional environments in that uranium is localized in fluvial
sandstones that lie beneath organic-rich lacustrine-marsh mudstones and
carbonaceous delta-front sediments. The reducing environment preserved in these
facies played an important role in the localization of uranium.

91

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Uranium deposits consist of closely-spaced, lenticular
mineralized pods which are generally concordant with bedding in paleochannel
sediments. Single mineralized pods range from a few feet to a few hundred feet
in length and from less than one to more than 10 feet in thickness. Deposits
range in size from a few tons to more than 600,000 tons. The Shinarump deposits
generally have low vanadium content, and are therefore not processed for
vanadium recovery.

The uranium deposit at the Daneros Project, like nearly all
others in the White Canyon district, is in the lower part of the Shinarump,
especially where it has scoured into the Moenkopi. The lithology, facies,
sedimentary structures, and locations within the channel deposits all were
important in controlling the migration of fluids and localization of the
deposits. Coarser-grained rock is more favorable than fine-grained sand or silt
units. Most of the uranium mineralization is overlying impermeable siltstones of
the Moenkopi or local siltstone lenses internal of the Shinarump. The lateral
edges of channels where they are bounded by mudstones are also favorable
locations for mineralization. Historical production from the White Canyon
District exceeds 11 million pounds of U3O8.

History

The White Canyon mining district has a long history of
exploration and mining. From 19491987 production from the district was
2,259,822 tons at an average grade of 0.24% U3O8 for a
total of 11,069,032 pounds placing itsecond, behind Lisbon Valley,
for uranium production from the Chinle Formation on the Colorado Plateau.

Exploration for uranium has been going on in the White Canyon
area since the late 1940s. Prospectors used Geiger counters to investigate
outcrops of the Shinarump Sandstone. The history of exploration is closely tied
to the Atomic Energy Commission (AEC) buying program, opening and closing of the several processing
facilities in the region, and the fluctuation of the price of uranium.

The properties in the Daneros Project area remained idle until
1946. From 1948 until 1951, White Canyon and the nearby Red Canyon and Deer Flat
areas were subject to intense exploration. The AEC ore procurement program ended
on December 31, 1970, and during the early 1970s minimal production was recorded
from the district.

Production from the district increased again by 1974 when the
demand for uranium increased due to nuclear power generation. Exploration and
production once again increased in the White Canyon District. In 1974, Utah
Power and Light Company (UP&L) began to acquire properties in the
White Canyon district, which included a 100% interest in the Spook-Bullseye
property and a 60% interest in the Lark-Royal property both located near the
Daneros Project in Red Canyon.

Between 1975 and 1985, UP&L conducted several phases of
drilling leading to definition of the Lark, Royal, and Bullseye deposits near
the modern day Daneros Project. UP&L drilled 595 diamond drill holes with an
average depth of 510 feet and, following industry standard procedures, logged
all holes using down-hole geophysical (gamma) probes to identify radioactive
horizons. Anomalous horizons were sampled and analyzed for uranium.

UP&L never started mining activities in the White Canyon
district, due to the collapse of the uranium price by 1982. By 1987 the last
mines in the White Canyon district closed due to declining economics,
socio-political factors and competition from lower cost producers. Following
1987, the properties were idle and little or no exploration activity took place
in the White Canyon district.

In 1993 UP&L dropped its mining claims in the White Canyon
District. In October 1993, Eugene and Merwin Shumway staked the Daneros claims
that covered the deposits UP&L had discovered. Eugene and Merwin Shumway
quitclaimed their claims to Wilene and Mike Shumway, Terry Leach, and James
Lammert in March, 1994. No exploration or development took place between 1994
and 2005. From 2005 to 2007, these individuals began acquiring properties with
known historic mineral deposits in the White Canyon district.

In 2007, Utah Commodities Pty, Ltd. who later changed its name
to White Canyon Uranium Limited (WCUL), which operated in the United
States through its wholly owned subsidiary, UEC, acquired a 100% interest in the
Daneros claims from those individuals. In December 2008, WCUL purchased 33
additional claims, known as the Lark-Royal Project, an extension of the Daneros
Project, from Uranium One.

WCUL began drilling programs in Bullseye Canyon during 2007.
The first program drilled 8 holes within the five Daneros claims. A second
program in 2008 drilled 16 diamond drill holes and 1 rotary drill hole. Finally,
a third program, also in 2008, drilled 11 diamond drill holes and 9
rotary drill holes. The success of this drilling provided the basis for mineral
resource estimates relied upon by WCUL to commence mining activities at the
Daneros Project.

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The Daneros Project was constructed and uranium bearing
material was extracted by WCUL, through its subsidiary UEC. WCUL gathered the
necessary environmental data and submitted applications for approvals to open an
underground facility at Daneros. A PO was submitted to the BLM and was approved
in May, 2009, following which UEC commenced active construction at the project,
including driving a decline into the main deposit at Daneros. The first loads of
mineralized material from the Daneros Project were delivered to the White Mesa
Mill in December, 2009, then operated by Denison Mines. In January 2010, Denison
entered into a toll milling agreement with UEC, which was then a wholly-owned
subsidiary of WCUL.

In 2011, Denison acquired all of the issued and outstanding
shares of WCUL, including all of the shares of UEC. In June 2012, Energy Fuels
acquired all of the issued and outstanding shares of WCUL as part of its
acquisition of the U.S. Mining Division from Denison, which included the Daneros Project
and all of the shares of UEC (which is now named EFR White Canyon Corp.).
Denison, and then the Company, kept the project in operation using the same
contractors (until placing it on standby in October 2012 after the Daneros
Project Technical Report was written. From 2010 through 2012 Denison and the
Company extracted approximately 123,000 tons of mineralized material from the
Daneros Project at an average grade of 0.288% U3O8 containing about 708,000 pounds of U3O8.

Mineralization

Uraninite (pitchblende) is by far the dominant primary uranium
mineral in the Shinarump deposits. It occurs as distinct grains, fine-grained
coatings on and pore-fillings between detrital quartz grains, partial
replacement of feldspar grains, and as replacement in carbonized wood and other
remains of organic matter. Metallic sulfide minerals are often abundant. Where
secondary oxidation has occurred, minor amounts of uranyl carbonates, sulfates,
and phosphates are found. The source of the uranium is not well established.
Overlying shaley units of the Chinle contain clays derived from volcanic ash
that is uraniferous. The source area of the arkosic sediments was also a
uranium-rich province.

Present Condition of the Property and Work Completed to Date

The Daneros Project is fully permitted and constructed. The
facilities consist of a modular trailer for the project office, two reinforced
portals for access to and from the underground workings, a generator building,
and an equipment storage and maintenance building. The deposit is accessed from
the surface through a 450 feet long decline at a gradient of -15%. Two
ventilation shafts daylight on the topographic bench above the underground
workings.

The Daneros Project was acquired by the Company in June 2012,
through the acquisition of the Denison US Mining Division. The cost of the
Daneros Project has been fully impaired, and as of December 31, 2015, the total
cost attributable to the Daneros Project and its associated equipment on the
financial statements of the Company was nil.

The Companys Planned Work

We are maintaining the project on care and maintenance.
Additional permitting is ongoing as described above. Energy Fuels has reviewed
the remaining resources and has evaluated prospective areas for future
exploration drilling. There are no plans to perform any drilling in 2016.

Mineral Resource Estimate

We published an Inferred Mineral Resource for the Daneros
property on July 19, 2012, based on the Daneros Mine Technical Report, soon
after the property was acquired from Denison. The following table summarizes the
resource estimate set out in that report. Note, the following resource estimates
were prepared under NI-43-101 and CIM definitions. None of the resources are
reserves within the meaning of SEC Industry Guide 7.

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INFERRED MINERAL RESOURCES  JULY 2012 Energy Fuels Inc.
Daneros Deposit

DEPOSIT
    TONS
    %eU3O8
    LBSDANEROS
    156,600
    0.263
    824,109


Notes:

| | 1) | Mineral Resources were classified in accordance with CIM
      Definition Standards and are not reserves within the meaning of SEC
      Industry Guide 7. Mineral Resources that are not reserves do not have
      demonstrated economic viability.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2) | Cut-off grade was 0.15%
    eU3O8.                                                                                                                                                                                                                   
| | 3) | Mineral resources have not been demonstrated to be
      economically viable.                                                                                                                                                                        
| | 4) | Grades were converted from gamma-log and assay data and
      presented in equivalent U3O8 (eU3O8).                                                                                                                                                  
| | 5) | A grade-shell wireframe at 0.15% eU3O8 was used to constrain the grade interpolation.                                                                                                                                                                
| | 6) | All material within the wireframe is included in the
      estimate.                                                                                                                                                                                 
| | 7) | High grades were capped at 0.8 %
      eU3O8.                                                                                                                                                                                                        

After completion of the Daneros Technical Report in June 2012,
mining continued through October 2012. The remaining Inferred Mineral Resource
estimate following that mining is approximately 156,000 tons of material at an
average grade of 0.21% U3O8 containing 661,000 pounds of
U3O8.

94

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Non-Material Mineral Properties

This section describes additional non-material mineral
properties that we hold. As these projects are not considered material to our
business, we may pursue the potential sale, joint venture, trade or other
transaction involving one or more of these projects.

We hold the following non-material mineral properties:

Other ISR Projects

Our Properties in the Powder River Basin, Wyoming:

Our properties in the Powder River Basin of Wyoming, but
outside of the Nichols Ranch Project, include 19,801 acres consisting of
property 100% owned by the Company through its wholly owned subsidiary, Uranerz.
These properties include: the North Rolling Pin Property, the Reno Creek
Property, the West North Butte Property, and the Collins Draw, Willow Creek,
East Nichols, North Nichols, Verna Ann, and Niles Ranch properties.

In general, these ISR projects are located in basins containing
sandstones of Tertiary age with known uranium mineralization. Limited
exploration was conducted by Uranerz on each project except for Verna Ann and
Niles Ranch.

Additional leasing in the Reno Creek Property prompted Uranerz
to acquire past exploration data for this area, which indicates potential
uranium mineralization. Additional exploration and environmental base-line work
will be required before submitting permit applications for the Reno Creek
Property. The Reno Creek Property consists of three unpatented lode mining
claims, 18 mineral leases, and three surface use agreements. The project area
covers approximately 1,332.57 acres. The fee land in the project is covered by
mineral leases, some of which have annual payments and some of which are paid up
leases. The mineral leases have primary terms of 10 years and can be held by
production (as defined in the leases). Some of the mineral leases will expire
in 2016, 2017, 2018 and 2019. The fee surface is covered by three Surface Use
Agreements which include damage payments paid on an annual basis. Sixteen of the
mining leases have a two-tier royalty based on the price of
U3O8 at the time of sale, which is 6% for a
U3O8 price less than $45.00 per pound or 8% for
a U3O8 price equal to or greater than $45.00per pound. Two of these leases have a flat 8% of the total gross proceeds.
Access to the project is off of Highway 387, which runs through the northern end
of the project area. A technical report titled Technical Report, Reno Creek
Property, Campbell County, Wyoming, U.S.A. dated October 13, 2010, was prepared
by Douglass Graves, P.E. of Trec, Inc., in accordance with NI 43-101 (the
Reno Creek Technical Report). Mr. Graves is a qualified person and
independent of the Company within the meaning of NI 43-101. The Reno Creek
Technical Report is available on SEDAR at www.sedar.com.The Reno Creek
Technical Report reports the following mineral resources calculated in
accordance with NI 43-101. None of these resources are reserves within the
meaning of SEC Industry Guide 7.

Reno Creek Mineral Resources(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)Measured Resources
    2,281
    0.061%
    2,782Indicated Resources
    1,550
    0.049%
    1,511Total M&I
    3,831
    0.056%
    4,293Inferred Resources
    190
    0.037%
    142


Other Wholly-owned Powder River Basin ISR Mineral
      Resources(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)Measured Resources Total
    310
    0.062%
    387North Rolling Pin (2)
    310
    0.062%
    387Indicated Resources Total
    1,198
    0.130%
    3,115West North Butte (3)
    926
    0.153%
    2,837North Rolling Pin
    272
    0.051%
    278Total M&I
    1,508
    0.116%
    3,502Inferred Resources
    1,156
    0.117%
    2,715


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TotalWest North Butte (3)
    1,117
    0.120%
    2,682North Rolling Pin
    39
    0.042%
    33


| | (1) | All numbers are rounded. Mineral resources that are not

      reserves do not have demonstrated economic viability. Information
      shown in the tables above and below differs from the disclosure
      requirements of the SEC. See Cautionary Note to U.S. Investors
      Concerning Disclosure of Mineral Resources, above.                                      
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | The North Rolling Pin property is discussed in the
      Technical Report titled Technical Report West North Butte Satellite
      Properties Campbell County, Wyoming, U.S.A., dated December 9, 2008,
      prepared by Douglas H. Graves of TREC, Inc. and Don R. Woody of Woody
      Enterprises and is available on SEDAR at www.sedar.com.                         
| | (3) | The West North Butte satellite properties include West
      North Butte, East North Butte, and Willow Creek, as described in the
      Technical Report titled Technical Report North Rolling Pin Property
      Campbell County, Wyoming, U.S.A. dated June 4, 2010, prepared by Douglas
      H. Graves of TREC, Inc. and is available on SEDAR at
      www.sedar.com.

Arkose Joint Venture, Powder River Basin, Wyoming:



The Company, through its wholly owned subsidiary Uranerz, holds
an undivided 81% interest in the Arkose Joint Venture, which holds an additional
46,748 acres in the Powder River Basin. Uranerz completed the acquisition of its
interest in the Arkose Joint Venture mineral properties on January 15, 2008.
This acquisition was completed pursuant to a purchase and sale agreement
previously announced on September 19, 2007 between Uranerz, and NAMMCO, Steven
C. Kirkwood, Robert W. Kirkwood and Stephen L. Payne (collectively, the
NAMMCO Sellers).

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In connection with the acquisition of its interest in the
Arkose Joint Venture, Uranerz entered into a venture agreement dated as of
January 15, 2008 (the Venture Agreement) with United Nuclear, LLC
(United Nuclear), a limited liability company wholly owned by the
NAMMCO Sellers and their designee under the purchase and sale agreement. Under
the Venture Agreement, United Nuclear will hold (and contribute to) its nineteen
percent (19%) working interest in the Arkose Joint Venture, and Uranerz will
operate and be the manager of the Venture. Uranerz and United Nuclear agreed to
contribute funds to programs and budgets approved under the Arkose Mining
Venture in accordance with their respective interests in the Venture.

The Arkose Mining Venture includes the following property units
on which Uranerz has conducted exploration:

- North Jane *
- South Doughstick
- Cedar Canyon
- East Buck
- South Collins Draw
- Sand Rock
- Little Butte
- Beecher Draw
- Lone Bull
- Kermit
- Monument
- Stage

*now included in the Nichols Ranch Project as part of the Jane
Dough Property.

Except as noted, the following description of the Arkose Joint
Venture properties is based on a technical report titled Arkose Uranium Project
Mineral Resource and Exploration Target, 43-101 Technical Report dated February
28, 2015, prepared by Douglas L. Beahm, P.E., P.G. of BRS, Inc. in accordance
with NI 43-101 (the Arkose Technical Report). Mr. Beahm is a qualified
person and is independent of the Company within the meaning of NI 43-101. The
Arkose Technical Report is available on SEDAR at www.sedar.com.

The Arkose Joint Venture properties are comprised of unpatented
lode mining claims, state leases and fee (private) mineral leases, summarized as
follows:

|Property                      | Ownership Interest(1) |  | Number of Claims/ |  | Acreage      
|----------------------------- | --------------------- |  | ----------------- |  | -------------
|Composition                   |                       |  | Leases            |  | (Approximate)
|Unpatented Lode Mining Claims | 81%                   |  | 1,672             |  | 33,423       
|State Leases                  | 81%                   |  | 3                 |  | 2,080        
|Fee (private) Mineral Leases  | 81%                   |  | 60                |  | 11,245       
|TOTAL                         |                       |  | 1,735             |  | 46,748       

|(1) | Subject to royalties.
|--- | ---------------------

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Arkose JV-owned Powder River Basin ISR Mineral
      Resources(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)Measured Resources
    ---
    
    ---Indicated Resources
    ---
    
    ---Inferred Resources Total
    2,058
    0.099%
    4,066East Buck
    656
    0.11%
    1,436Little Butte
    1,021
    0.09%
    1,752Sand Rock
    184
    0.10%
    381South Doughstick
    197
    0.13%
    497


| | (1) | All numbers are rounded. The Mineral Resources are not
      reserves within the meaning of SEC Industry Guide 7. Mineral resources that are not

      reserves do not have demonstrated economic viability. Information
      shown in the table above differs from the disclosure requirements of the
      SEC. See Cautionary Note to U.S. Investors Concerning Disclosure of
      Mineral Resources, above.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Shirley Basin, Wyoming

Our wholly-owned Shirley Basin uranium properties exceed 2,500
acres of federal lode mining claims (126 unpatented claims) and 680 acres in two
Wyoming State Leases. Previous exploration conducted by Utah International
identified a number of mineralized areas requiring follow-up exploration. Some
of our property in the Shirley Basin is adjacent to Ur-Energys planned ISR mine
and may be offered for sale.

We acquired the Shirley Basin properties on August 29, 2013 as
a result of our acquisition of Strathmore.

Other Conventional Projects

Arizona Strip

Extraction of mineralized materials at our Pinenut Project
commenced in July of 2013 and concluded in the first half of 2015, when the
resources were considered to be depleted. We continue to ship mineralized
material from the surface stockpile at Pinenut to the White Mesa Mill. All
mineralized material should be removed from the project site by mid-March 2016.
The Pinenut Project is currently in reclamation. Mineral extraction at our
Arizona 1 Project commenced in December 2009, and continued until the project
was placed on standby in February 2014 due to the depletion of the readily
available resources. The Wate Project and EZ Project are in the permitting
and/or evaluation stage. Permitting at the Wate Project and the EZ Project is
currently on hold. The DB1 breccia pipe deposit is in the exploration stage. A
description of the Wate Project can be found in the NI 43-101 report titled NI
43-101 Technical Report on Resources Wate Uranium Breccia Pipe-Northern Arizona,
USA dated March 10, 2015, prepared by Allan Moran and Frank A. Davies of SRK
Consulting and available on www.sedar.com and on EDGAR at
www.sec.gov. A description of the Arizona 1 and Pinenut Projects can be
found in the Technical Report titled Technical Report on the Arizona Strip
Uranium Project, Arizona, U.S.A., dated June 27, 2012, prepared by Thomas C.
Pool, P.E and David A. Ross, M.Sc., P.Geo. of RPA and available on
www.sedar.com and on EDGAR at www.sec.gov. The EZ Project is
described in the technical report titled Technical Report on the EZ1 and EZ2
Breccia Pipes, Arizona Strip District, U.S.A. dated June 27, 2012, prepared by
David A. Ross and Christopher Moreton of Roscoe Postle Associates and available
on www.sedar.com and on EDGAR at www.sec.gov.

Other Arizona Strip Properties Mineral
      Resources(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)Measured Resources
    ---
    
    ---Indicated Resources
    ---
    
    ---Inferred Resources Total
    321
    0.523%
    3,357Arizona 1
    26
    0.258
    134Pinenut
    ---
    ---
    ---Wate
    71
    0.787
    1,118EZ1 and EZ2
    224
    0.47%
    2,105


(1)      
 All numbers are rounded. The Mineral Resources are not reserves within the
meaning of SEC Industry Guide 7.  Mineral resources that are not  reserves
do not have demonstrated economic viability. Information shown in the table
above differs from the disclosure requirements of the SEC. See
Cautionary Note to U.S. Investors Concerning Disclosure of Mineral
Resources, above.

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Colorado Plateau

As a result of declining uranium prices, the Rim property (the
Rim Property) was placed on standby in March 2009, by the previous
operator, Denison. It is maintained so that it can be restarted with little
relative effort or development costs. The Rim Property is located 15 miles
northeast of Monticello, Utah in San Juan County. The property consists of 26
unpatented lode mining claims, a private lease, and a Utah State Mineral Lease
totaling about 1,100 acres. No exploration is planned in 2016.

The Whirlwind Project comprises 126 unpatented lode mining claims
covered by three  Mineral Leases and a Utah State Mineral Lease of
320 acres for a total acreage of about 2,800 acres. The property size (as
reported in the NI 43-101 report Updated Technical Report on Energy Fuels
Resources Corporations Whirlwind Property (Including Whirlwind, Far West, and
Crosswind Claim Groups and Utah Metalliferous Minerals Lease ML-49312) Mesa
County, Colorado and Grand County, Utah dated March 15, 2011, prepared by
Douglas C. Peters of Peters Geosciences, available on www.sedar.com) has
been reduced since the acquisition. The retained property continues to cover the
known mineralized areas that are described in the Technical Report. The
Whirlwind Project straddles the Utah/Colorado state line 4.5 miles southwest of
Gateway, Colorado. The Whirlwind Project was refurbished by the Company in 2008,
and remains on standby status. Exploration drill projects were conducted in
2007, 2008, 2009, 2010, 2011 and 2012. No exploration is planned for 2016.

The Sage Plain Project is a uranium/vanadium property in the
evaluation stage. It is located in southeast Utah about 15 miles northeast of
Monticello, Utah in the southwest continuation of the Uravan Mineral Belt. The
project area includes one historic property, the Calliham Mine, which was
operated by Atlas Minerals in the 1980s and briefly by Umetco Minerals Corp. in
the early 1990s. Calliham ceased production due to low uranium prices. It
consists of three fee mineral leases covering about 1,670 acres. A description
of the property can be found in the NI 43-101 report Updated Technical Report
on Sage Plain Project (Including the Calliham Mine) San Juan County, Utah,
U.S.A.. dated March 18, 2015, prepared by Douglas C. Peters of Peters
Geosciences and available on www.sedar.com.

Other Colorado Plateau Conventional Properties Mineral
      Resources(1)Classification
    Tons (,000)
    Grade 
      %eU3O8
    Pounds U3O8
      (,000)
    Grade 
      %eV2O5
    Pounds V2O5
    (,000)Measured Resources Total
    444
    0.173%
    1,540
    1.43%
    12,714Sage Plain
    444
    0.173%
    1,540
    1.43%
    12,714Indicated Resources Total
    200
    0.269%
    1,074
    0.96%
    3,840Whirlwind
    169
    0.297%
    1,003
    0.97%
    3,293Sage Plain
    31
    0.115%
    71
    0.88%
    547Inferred Resources Total
    449
    0.227%
    2,037
    0.75%
    6,756Whirlwind
    437
    0.229%
    2,000
    0.74%
    6,472Sage Plain
    12
    0.154%
    37
    1.18%
    284


| | (1) | All numbers are rounded. These Mineral Resources are not
      reserves within the meaning of SEC Industry Guide 7. Mineral resources that are not

      reserves do not have demonstrated economic viability. Information
      shown in the table above differs from the disclosure requirements of the
      SEC. See Cautionary Note to U.S. Investors Concerning Disclosure of
      Mineral Resources, above.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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Gas Hills

No mining activity has taken place at the Gas Hills Project in
Wyoming since our acquisition of the property in August 2013 through our
acquisition of Strathmore. The last mining activity on the property occurred in
the 1980s. The property size (as reported in the NI 43-101 report National
Instrument 43-101 Technical Report Update of Gas Hills Uranium Project Fremont
and Natrona Counties, Wyoming, USA dated March 22, 2013, prepared by Richard L
Nielsen, Thomas C. Pool, Robert L. Sandefur, and Matthew P. Reilly of Chlumsky,
Armburst, and Meyer, available on www.sedar.com), has been reduced since
the acquisition. We now hold 628 unpatented lode mining claims (approximately
12,500 acres) lying in both Natrona and Fremont counties 22 miles northeast of
Jeffrey City, Wyoming, a 320 acre Wyoming State Mineral Lease, and a private
Mineral Lease covering 80 acres. The retained property continues to cover the
known mineralized areas that are described in the Gas Hills Technical Report.
The Gas Hills Project is currently being held for sale or disposition.

Gas Hills Mineral Resources(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)Measured Resources
    ---
    
    ---Indicated Resources
    2,300
    0.117%
    5,400Inferred Resources
    3,900
    0.071%
    5,500


| | (1) | All numbers are rounded. These Mineral Resources are not
      reserves within the meaning of SEC Industry Guide 7. Mineral resources that are not

      reserves do not have demonstrated economic viability. Information
      shown in the table above differs from the disclosure requirements of the
      SEC. See Cautionary Note to U.S. Investors Concerning Disclosure of
      Mineral Resources, above.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Juniper Ridge

No mining activity has occurred at the Juniper Ridge Project in
Wyoming since our acquisition of the property in August 2013 through our
acquisition of Strathmore. The last mining activity on the property occurred in
the 1970s. The property size (as reported in the NI 43-101 report Juniper
Ridge Uranium Project Carbon County, Wyoming, USA Updated 43-101 Mineral
Resource and Preliminary Economic Assessment Technical Report dated January 27,
2014, prepared by Douglas L. Beahm of BRS Inc. and Terrence P. McNulty of T.P.
McNulty and Associates Inc. and available on www.sedar.com) has been
reduced since the acquisition. We now hold 130 unpatented lode mining claims
(approximately 2,500 acres) and a 640 acre Wyoming State Mineral Lease located
in Carbon County, six miles west of Baggs, Wyoming. The retained property
continues to cover the known mineralized areas that are described in the Juniper
Ridge Technical Report. The Juniper Ridge Project is currently being held for
sale or disposition.

Juniper Ridge Mineral Resources(1)Classification
    Tons (,000)
    Grade %eU3O8
    Pounds U3O8 (,000)Measured Resources
    ---
    
    ---Indicated Resources
    5,233
    0.058%
    6,120Inferred Resources
    107
    0.085%
    182


| | (1) | All numbers are rounded. These Mineral Resources are not
      reserves within the meaning of SEC Industry Guide 7. Mineral resources that are not

      reserves do not have demonstrated economic viability. Information
      shown in the table above differs from the disclosure requirements of the
      SEC. See Cautionary Note to U.S. Investors Concerning Disclosure of
      Mineral Resources, above.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Sold Properties

Three properties that we previously held in New Mexico were
sold in 2015. The claims at the Nose Rock property and the private lease of the
Marquez property were sold to Tigris in December 2015. The claims and State
Mineral Leases on the Church Rock property were assigned to URI in August 2015
as partial consideration for the properties we acquired from URI contiguous with
the Roca Honda Project. The Utah State Mineral Lease at the Cedar
Mountain property was also sold to Tigris in December 2015 along with three
exploration claim groups in southern Utah: Geitus, Blue Jay, and Marcy-Look.

Exploration Properties

Department of Energy (DOE) Lease Tracts

We currently hold eight DOE uranium leases in the Uravan
Mineral Belt portion of Mesa, Montrose, and San Miguel Counties, Colorado. The
tracts are designated C-SR-12, C-SR-16A, C-AM-19, C-AM-20, C-CM-24, C-G-26, and
C-G-27. A Federal Court Order in 2011 halted all physical work on these tracts
until the DOE completes a full EIS on its Uranium Leasing Program. The Final EIS
was made available and the Record of Decision was published in the Federal
Register on May 12, 2014. The DOEs preferred alternative is to resume the
leasing program essentially as it was before the law suit. However, the DOE has
not yet petitioned the Court to remove the stay on the leases; therefore, we
have no plans for any additional exploration work in 2016. Prior to the 2011
stay, we conducted drilling on CM-24 and G-26.

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HC Claims (Calamity Mesa) and Torbyn Claims (Tenderfoot
Mesa)

We lease two groups of unpatented lode mining claims from Rimrock
Exploration and Development Inc. (Rimrock). The 30 HC claims are
located on Calamity Mesa, Mesa County, Colorado and cover the historic New Verde
property. Three drill projects have been completed on the HC claims in 2007,
2008, and 2009. The New Verde property is adjacent to DOE lease C-G-26. It will
remain a low-priority exploration project until the Court lifts the injunction
against the DOE leasing program (seeDOE Lease Tractsabove).

The Torbyn property on Tenderfoot Mesa, Mesa County, Colorado
consists of 40 unpatented lode mining claims covering the Torbyn property and
surrounding area. Four drilling programs have been completed on the Torbyn
claims in 2007, 2008, 2009, and 2012. More drilling is needed to enlarge the
known resource near the historic property in order to make a decision whether to
proceed with permitting. However, no exploration drilling is planned in 2016.

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ITEM 3. LEGAL PROCEEDINGS

Other than routine litigation incidental to our business, or as
described below, the Company is not currently a party to any material pending
legal proceedings that management believes would be likely to have a material
adverse effect on our financial position, results of operations or cash flows.

White Mesa Mill

In November 2012, the Company was served with a Plaintiffs
Original Petition and Jury Demand in the District Court of Harris County, Texas,
claiming unspecified 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 while working at
the White Mesa Mill. The Company does not consider this claim to have any merit,
and therefore does not believe it will materially affect our financial position,
results of operations or cash flows. In January, 2013, the Company filed a
Special Appearance challenging jurisdiction and certain other procedural matters
relating to this claim. No other activity involving the Company on this matter
has occurred since that date.

In January, 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 in the shallow aquifer at
the White Mesa Mill site. This challenge is currently being evaluated, and may
involve the appointment of an administrative law judge to hear the matter. The
Company does not consider this action to have any merit. If the petition is
successful, the likely outcome would be a requirement to modify or replace the
existing Corrective Action Plan. At this time, the Company does not believe any
such modification or replacement would materially affect our 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.

In April 2014, the Grand Canyon Trust filed a citizen suit in
federal district court for alleged violations of the Clean Air Act at the White
Mesa Mill. In October 2014, the plaintiffs were granted leave by the court to
add further purported violations to their April 2014 suit. The Complaint, as
amended, alleges that radon from one of the Mills tailings impoundments
exceeded the standard; that the mill is in violation of a requirement that only
two tailings impoundments may be in operation at any one time; and that certain
other violations related to the manner of measuring and reporting radon results
from one of the tailings impoundments occurred in 2013. The Complaint asks the
court to impose injunctive relief, civil penalties of up to $37,500 per day per
violation, costs of litigation including attorneys fees, and other relief. The
Company believes the issues raised in the Complaint are being addressed through
the proper regulatory channels and that we are currently in compliance with all
applicable regulatory requirements relating to those matters. The Company
intends to defend against all issues raised in the Complaint. The parties are
currently briefing motions for summary judgement relating to this litigation.

Canyon Project

In March, 2013, the Center for Biological Diversity, the Grand
Canyon Trust, the Sierra Club and the Havasupai Tribe (the Canyon
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 USFS seeking an order (a) declaring that the USFS
failed to comply with environmental, mining, public land, and historic
preservation laws in relation to our Canyon Project, (b) setting aside any
approvals regarding exploration and mining operations at the Canyon Project, and
(c) directing operations to cease at the Canyon Project and enjoining the USFS
from allowing any further exploration or mining-related activities at the Canyon
Project until the USFS fully complies with all applicable laws. In April 2013,
the Plaintiffs filed a Motion for Preliminary Injunction, which was denied by
the District Court in September, 2013. On April 7, 2015, the District Court
issued its final ruling on the merits in favor of the Defendants and the Company
and against the Canyon Plaintiffs on all counts. The Canyon Plaintiffs appealed
the District Courts ruling on the merits to the Ninth Circuit Court of Appeals,
and filed motions for an injunction pending appeal with the District Court.
Those motions for an injunction pending appeal were denied by the District Court
on May 26, 2015. Thereafter, Plaintiffs filed urgent motions for an injunction
pending appeal with the Ninth Circuit Court of Appeals, which were denied on
June 30, 2015. Briefing on the appeal on the merits is now complete, and the
parties are waiting for a hearing to be scheduled. If the Canyon Plaintiffs are
successful on their appeal on the merits, the Company may be required to maintain
the Canyon Project on standby pending resolution of the matter. Such a required
prolonged stoppage of shaft sinking and mining activities could have a
significant impact on our future operations.

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ITEM 4. MINE SAFETY DISCLOSURE

The mine safety disclosures required by section 1503(a) of the
Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of
Regulation S-K are included in Exhibit 95.1 of this Annual Report.

103

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PART II

ITEM 5. MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED
STOCKHOLDERMATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

Energy Fuels Common Shares are listed and traded on the TSX
under the symbol EFR and on the NYSE MKT under the symbol UUUU. The
following table sets forth, for the calendar quarters indicated, the high and
low sales price per common share of Energy Fuels, in each case as reported on
the NYSE MKT and the TSX. In addition, the table sets forth the quarterly cash
dividends per share declared by Energy Fuels with respect to its Common
Shares.

Energy Fuels NYSE MKT
    
    
    Energy Fuels TSX**(US Dollars)**
    
    
    (Canadian Dollars)Dividends
    
    
    
    
    
    
    
    
    DividendsHigh
    
    
    Low
    
    
    Declared
    
    
    High
    
    
    Low
    
    
    Declared2015First Quarter
    $
    6.25
    
    $
    4.26
    
    $
    
    
    $
    7.32
    
    $
    5.40
    
    $
    Second Quarter
    $
    5.60
    
    $
    4.00
    
    $
    
    
    $
    6.73
    
    $
    5.03
    
    $
    Third Quarter
    $
    4.71
    
    $
    2.76
    
    $
    
    
    $
    6.09
    
    $
    3.68
    
    $
    Fourth Quarter
    $
    3.48
    
    $
    1.84
    
    $
    
    
    $
    4.50
    
    $
    2.47
    
    $
    2014First Quarter
    $
    11.85
    
    $
    5.75
    
    $
    
    
    $
    13.03
    
    $
    6.10
    
    $
    Second Quarter
    $
    9.87
    
    $
    6.62
    
    $
    
    
    $
    10.87
    
    $
    7.15
    
    $
    Third Quarter
    $
    7.99
    
    $
    6.46
    
    $
    
    
    $
    8.68
    
    $
    7.22
    
    $
    Fourth Quarter
    $
    8.00
    
    $
    5.55
    
    $
    
    
    $
    9.00
    
    $
    6.24
    
    $
    


As of March 14, 2016, the closing bid quotation for our Common
Shares was $2.39 per share as quoted by the NYSE MKT.

As of March 14, 2016, Energy Fuels had 51,889,545 Common Shares
issued and outstanding, held by approximately 46,000 shareholders. Most shares are
registered through intermediaries, making the precise number of shareholders
difficult to obtain.

Dividend Policy

We have never declared cash dividends on our common shares. We
anticipate that we will retain any earnings to support operations and to finance
the growth of our business. Therefore, we do not expect to pay cash dividends in
the foreseeable future. Any further determination to pay cash dividends will be
at the discretion of our Board of Directors and will be dependent on the
financial condition, operating results, capital requirements, and other factors
that our Board of Directors deems relevant.

Recent Sales of Unregistered Securities

On June 22, 2015, the Company issued 301,268 Common Shares to
Cantor Fitzgerald Canada Corporation and 316,564 Common Shares to Haywood
Securities Inc. in satisfaction of financial advisory fees relating to the
acquisition of Uranerz. The issuance of these securities was exempt from the
registration requirements of the Securities Act by virtue of Regulation S.

On August 3, 2015, the Company issued 76,455 Common Shares to
Uranium Resources, Inc. to acquire certain properties from Uranium Resources,
Inc. These shares were not registered under the Securities Act, or the laws of
any state and are subject to resale restrictions and may not be offered or sold
in the United States absent registration or an applicable exemption from the registration requirements.
The issuance of these securities was exempt from the registration requirements
of the Securities Act by virtue of Section 4(a)(2) as a transaction by an issuer
not involving a public offering.

104

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On October 27, 2015, the Company issued 92,906 Common Shares to
Anfield Resources Holding Corp. to acquire its 50% membership interest in Wate
Mining Company, LLC. These shares were not registered under the Securities Act,
or the laws of any state and are subject to resale restrictions and may not be
offered or sold in the United States absent registration or an applicable
exemption from the registration requirements. The issuance of these securities
was exempt from the registration requirements of the Securities Act by virtue of
Section 4(a)(2) as a transaction by an issuer not involving a public
offering.

Use of Proceeds

The sale of Common Shares pursuant to an at the market
(ATM) offering commenced on October 15, 2015. A Form F-10 Registration
Statement (File No. 333-194916) and a prospectus supplement dated September 29,
2015 are available on EDGAR at www.sec.gov. The offering has terminated
in conjunction with filing this Annual Report on Form 10-K. Sales under the ATM
were made pursuant to a Sales Agreement entered into with Cantor Fitzgerald
& Co. The estimated amount of expenses incurred for the Companys account in
connection with the issuance of the distribution of the securities was $238,000.
This amount includes the sales commission paid to Cantor Fitzgerald & Co. As
of December 31, 2015, the Company had received $2.87 million from the ATM
offering (additional funds were also received subsequent to the year-end);
however the Company has not yet spent any of the funds received. The Company
anticipates using such proceeds in the first and/or second quarter of 2016 to:
repurchase any Debentures pursuant to the normal course issuer bid; fund
development at the Nichols Ranch Project; finance development of its Canyon
Project; and for general corporate needs and working capital requirements.
Management of Energy Fuels will have discretion with respect to the actual use
of the net proceeds of the ATM offering.

Repurchase of Securities

During 2015, neither we nor any of our affiliates repurchased
shares of our common shares registered under Section 12 of the Securities
Exchange Act of 1934, as amended. On October 2, 2015, the Company commenced a
normal course issuer bid (NCIB) to purchase for cancellation up to
Cdn$2.2 millionaggregate amount of its outstanding Debentures,
representing approximately 10% of the Cdn$22,000,000 aggregate principal amount
of Debentures outstanding at that time. The Company may purchase the Debentures
at prevailing market prices and by means of open market transactions through the
facilities of the TSX. The NCIB will remain in effect until the earlier of
October 1, 2016, or the date on which the Company has purchased the maximum
number of Debentures permitted under the NCIB. As of the date hereof, the
Company has not repurchased any Debentures under the NCIB.

Equity Compensation Plan Information

The following table provides information as of December 31,
2015, concerning stock options and restricted stock units (RSUs)
outstanding pursuant to our 2015 Omnibus Equity Incentive Compensation Plan (the
Equity Incentive Plan), which has been approved by the Companys
shareholders. Energy Fuels does not have an equity compensation plan that has
not been approved by shareholders. The table also includes options that we
assumed as part of the Uranerz acquisition. Options which were assumed as part
of the Strathmore acquisition have expired and are therefore excluded from the
table below, since none remained outstanding at December 31, 2015.

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Plan Category
    Number of Common Shares
      to be issued upon exercise of outstanding
      options, warrants
    and rights(1)
    Weighted-average
      exercise price of outstanding options,
    warrants
    and rights
      (USD)(1)
    Number of Common Shares
      remaining available for future issuance(1)Energy Fuels Omnibus Equity Incentive Compensation Plan
    2,365,559(2)
    $5.68(3)
    2,825,488Uranerz Replacement Options
    1,159,578
    $5.74
    NilTotal
    3,525,137
    $5.71
    2,825,488


(1) The number of Energy Fuels Common Shares, and the exercise
price thereof, have been adjusted to take into account the 50 for 1 share
consolidation that occurred on November 5, 2013 (the
Consolidation).
(2) Includes 1,287,829 stock options and 1,077,730 restricted stock units. Each
restricted stock unit vests as to 50% one year after the date of grant, as to
another 25% two years after the date of grant and as to the remaining 25% three
years after the date of grant. Upon vesting, each restricted stock unit entitles
the holder to receive one common share without any additional payment.
(3) 1,077,730 restricted stock units have been excluded from the weighted
average exercise price because there is no exercise price.

Energy Fuels Equity Incentive
Plan

The Equity Incentive Plan was approved by the board of
directors on January 28, 2015 and by shareholders on June 18, 2015. The Equity
Incentive Plan supersedes and replaces the Energy Fuels Stock Option Plan, which
was the Companys prior equity incentive program. All stock options previously
granted pursuant to the Energy Fuels Stock Option Plan which remain outstanding
are incorporated into the Equity Incentive Plan. Employees, directors, and
consultants of the Company and its affiliates are eligible to participate in the
Equity Incentive Plan. The Board of Directors, or a Committee authorized by the
Board of Directors (the Committee), administers the Equity Incentive
Plan. The Committee may grant awards for non-qualified stock options, incentive
stock options, stock appreciation rights, restricted stock, deferred share
units, restricted stock units, performance shares, performance units, and
stock-based awards to eligible participants. The ability to grant a broad range
of equity incentive awards is consistent with the practices of similar public
companies. Pursuant to the rules of the TSX, the Equity Incentive Plan must be
renewed by approval of Energy Fuels shareholders every three years.

Uranerz Options

On June 18, 2015, in connection with the acquisition of
Uranerz, Energy Fuels issued 2,048,000 stock options of Energy Fuels, by
assuming the then-existing options granted pursuant to the Uranerz 2005 Stock
Option Plan, as amended on June 10, 2009 (the 2005 Stock Option Plan).
These options are now exercisable for Energy Fuels Common Shares, subject to
the exchange ratio set out in the Merger Agreement. No further stock options
will be granted pursuant to the 2005 Stock Option Plan. The options have varying
expiry dates with the last options expiring in June 2025.

Stock Performance Graph

The performance graph below shows Energy Fuels cumulative
total 5-year return based on an initial investment of $100 in Energy Fuels
common shares beginning on December 31, 2010, as compared with the Russell 2000
Index, NYSE MKT Natural Resources Index, NYSE Composite, NASDAQ Composite, and a
peer group consisting of Ur-Energy, Peninsula Energy, Berkeley Energia, Toro
Energy, Uranium Energy Corp., Paladin Energy, UEX Corp., Denison Mines Corp.,
Uranium Resources Inc., and Energy Resources of Australia). The chart shows
yearly performance marks over a five year period. This performance chart
assumes: (1) $100 was invested on December 31, 2010 in Energy Fuels common
shares along with the Russell 2000 Index, NYSE MKT Natural Resources Index, NYSE
Composite, NASDAQ Composite, and the peer groups common stock; and (2) all
dividends are reinvested. Dates on the chart represent the last trading day of
the indicated fiscal year.

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Exchange Controls

There are no governmental laws, decrees or regulations in
Canada that restrict the export or import of capital, including foreign exchange
controls, or that affect the remittance of dividends, interest or other payments
to nonresident holders of the securities of Energy Fuels, other than Canadian
withholding tax. See Certain Canadian Federal Income Tax Considerations for
U.S. Residents below.

Certain Canadian Federal Income Tax Considerations

The following is, as of the date hereof, a summary of the
principal Canadian federal income tax considerations generally applicable under
the Income Tax Act(Canada) and the regulations promulgated thereunder,
or the Tax Act, to a holder who acquires, as beneficial owner, our Common
Shares, and who, for purposes of the Tax Act and at all relevant times: (i)
holds the Common Shares as capital property; (ii) deals at arms length with,
and is not affiliated with, us or the underwriters; (iii) is not, and is not
deemed to be resident in Canada; and (iv) does not use or hold and will not be
deemed to use or hold, our Common Shares in a business carried on in Canada, or
a Non-Resident Holder. Generally, our Common Shares will be considered to be
capital property to a Non-Resident Holder provided the Non-Resident Holder does
not hold our Common Shares in the course of carrying on a business of trading or
dealing in securities and has not acquired them in one or more transactions
considered to be an adventure or concern in the nature of trade. Special rules,
which are not discussed in this summary, may apply to a NonResident Holder that
is an insurer that carries on an insurance business in Canada and elsewhere.
Such NonResident Holders should seek advice from their own tax
advisors.

This summary is based upon the provisions of the Tax Act in
force as of the date hereof, all specific proposals, or the Proposed Amendments,
to amend the Tax Act that have been publicly and officially announced by or on
behalf of the Minister of Finance (Canada) prior to the date hereof and
managements understanding of the current administrative policies and practices
of the Canada Revenue Agency, or the CRA, published in writing by it prior to
the date hereof. This summary assumes the Proposed Amendments will be enacted in
the form proposed. However, no assurance can be given that the Proposed
Amendments will be enacted in their current form, or at all. This summary is not
exhaustive of all possible Canadian federal income tax considerations and,
except for the Proposed Amendments, does not take into account or anticipate any
changes in the law or any changes in the CRAs administrative policies or
practices, whether by legislative, governmental, or judicial action or decision,
nor does it take into account or anticipate any other federal or any provincial,
territorial or foreign tax considerations, which may differ significantly from
those discussed herein.

107

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Non-Resident Holders should consult their own tax advisors
with respect to an investment in our Common Shares. This summary is of a general
nature only and is not intended to be, nor should it be construed to be, legal
or tax advice to any prospective purchaser or holder of our Common Shares, and
no representations with respect to the income tax consequences to any
prospective purchaser or holder are made. Consequently, prospective purchasers
or holders of our Common Shares should consult their own tax advisors with
respect to their particular circumstances.

Currency Conversion

Generally, for purposes of the Tax Act, all amounts relating to
the acquisition, holding, or disposition of our Common Shares must be converted
into Canadian dollars based on the exchange rates as determined in accordance
with the Tax Act. The amounts subject to withholding tax and any capital gains
or capital losses realized by a NonResident Holder may be affected by
fluctuations in the Canadian-U.S. dollar exchange rate.

Disposition of Common Shares

A Non-Resident Holder will not generally be subject to tax
under the Tax Act on a disposition of a common share, unless the common share
constitutes taxable Canadian property (as defined in the Tax Act) of the
Non-Resident Holder at the time of disposition and the Non-Resident Holder is
not entitled to relief under an applicable income tax treaty or convention.

Provided the common shares are listed on a designated stock
exchange, as defined in the Tax Act (which currently includes the TSX and NYSE
MKT) at the time of disposition, the common shares will generally not constitute
taxable Canadian property of a Non-Resident Holder at that time, unless at any
time during the 60-month period immediately preceding the disposition the
following two conditions are satisfied concurrently: (i) (a) the NonResident
Holder; (b) persons with whom the Non-Resident Holder did not deal at arms
length; (c) partnerships in which the Non-Resident Holder or a person described
in (b) holds a membership interest directly or indirectly through one or more
partnerships; or (d) any combination of the persons and partnerships described
in (a) through (c), owned 25% or more of the issued shares of any class or
series of our shares; and (ii) more than 50% of the fair market value of our
shares was derived directly or indirectly from one or any combination of: real
or immovable property situated in Canada, Canadian resource properties,
timber resource properties (each as defined in the Tax Act), and options in
respect of, or interests in or for civil law rights in, such properties.
Notwithstanding the foregoing, in certain circumstances set out in the Tax Act,
the common shares could be deemed to be taxable Canadian property. Even if the
common shares are taxable Canadian property to a Non-Resident Holder, such
NonResident Holder may be exempt from tax under the Tax Act on the disposition
of such common shares by virtue of an applicable income tax treaty or
convention. A Non-Resident Holder contemplating a disposition of Common
Shares that may constitute taxable Canadian property should consult a tax
advisor prior to such disposition.

Receipt of Dividends

Dividends received or deemed to be received by a Non-Resident
Holder on our Common Shares will be subject to Canadian withholding tax under
the Tax Act. The general rate of withholding tax is 25%, although such rate may
be reduced under the provisions of an applicable income tax convention between
Canada and the Non-Resident Holders country of residence. For example, under
the Canada-United States Income Tax Convention (1980)as amended, or the
Treaty, the rate is generally reduced to 15% where the Non-Resident Holder is a
resident of the United States for the purposes of, and is entitled to the
benefits of, the Treaty.

108

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ITEM 6. SELECTED FINANCIAL DATA

Selected financial data about Energy Fuels for the last four
years is set forth in the table below. You should read the data in the table in
conjunction with the information contained in Item 7. Managements
Discussion and Analysis of Financial Condition and Results of Operations
and the consolidated financial statements and related notes set forth in Item 8.
Financial Statements and Supplementary Data. The 2012 numbers
are unaudited.

|                            |   | AtDecember31, | 
|--------------------------- | - | ------------- | 
|                            |   | 2015          | 
|Total assets                | $ | 192,280       | 
|Total long-term obligations | $ | 38,675        | 

|                                                                   |   | FortheyearendedDecember31, |  
|------------------------------------------------------------------ | - | -------------------------- | -
|                                                                   |   | 2015                       |  
|Sales                                                              | $ | 61,351                     |  
|Net income (loss) (1)                                              | $ | (82,357                    | )
|Basic and diluted income (loss) per share                          | $ | (2.46                      | )
|Dividends per share                                                |   | Nil                        |  
|                                                                   |   |                            |  
|(1)Included in the net income (loss) above                         |   |                            |  
|Gain on purchase of US Mining Division of
      Denison Mines Corp | $ | -                          |  
|Impairment losses on property, plant and equipment                 | $ | (10,994                    | )
|Impairment losses on goodwill                                      | $ | (47,730                    | )

Note: Over the four years shown above, the Company completed
significant acquisitions of businesses and assets. See Item 1, "Description of
Business; Development of the Business - Major Transactions over the Past Five
Years" above.

109

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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in
conjunction with our financial statements for the three years ended December 31,
2015, and the related notes thereto. This discussion and analysis contains
forward-looking statements that involve risks, uncertainties, and assumptions.
Our actual results may differ materially from those anticipated in these
forward-looking statements as a result of many factors, including, but not
limited to, those set forth under the section heading Item 1A. Risk Factors
and elsewhere in this Annual Report. See section heading Cautionary Statement
Regarding Forward-Looking Statements.

Conversion from IFRS to U.S. GAAP

In 2013, the Company listed its shares on the NYSE MKT, and
registered its securities under the Exchange Act. This registration subjected
the Company to ongoing reporting requirements under the Exchange Act. Under the
multijurisdictional disclosure system, Canadian issuers that meet the definition
of foreign private issuer under the rules of the United States Securities and
Exchange Commission (the SEC) are permitted to use Canadian disclosure
documents to largely satisfy their reporting requirements with the SEC. As a
result of the June 2015 acquisition of Uranerz, the Company now has more than
50% of its outstanding voting securities of record held either directly or
indirectly by residents of the United States. Accordingly, the Company ceased to
meet the requirements for foreign private issuer status for SEC reporting
purposes and, as of January 1, 2016, became a domestic issuer.

As a U.S. domestic issuer, the Company is required to file an
annual report on Form 10-K covering the year ended December 31, 2015. The Company is also, as of
January 1, 2016, obligated to comply with additional reporting requirements of
the Exchange Act applicable to domestic issuers, including filing quarterly
reports on Form 10-Q, current reports on Form 8-K, and proxy statements.

U.S. domestic issuers are required to prepare financial
statements included in SEC filings in accordance with United States Generally
Accepted Accounting Principles (US GAAP) and to report in U.S. dollars.
Accordingly, the Companys Annual Report on this Form 10-K contains, for the
three years ended December 31, 2015 audited annual financial statements which
have been prepared in accordance with US GAAP. All financial statements and
selected financial data for prior periods presented herein have been converted
from IFRS into US GAAP.

Overview

Prior to June 2012, Energy Fuels was primarily a uranium and
vanadium exploration, permitting, and evaluation company with no revenue or
operating properties. In June 2012, Energy Fuels acquired the US Mining Division
of Denison Mines Corp. and began revenue producing activities from these
properties. The activities of Energy Fuels, including support staff and
expenditures, increased dramatically upon completion of the acquisition. All
activities of the Company prior to the June 18, 2015 acquisition of Uranerz
concerned the Conventional Uranium Segment.

On June 18, 2015, Energy Fuels acquired all of the outstanding
shares of Uranerz which had, among other properties, an active in situ
uranium extraction and recovery facility. These operations acquired from Uranerz
are included in the consolidated financial statements as of June 18, 2015 and
represent the Companys ISR Uranium Segment.

While the Company has uranium extraction and recovery
activities and generates revenue, it is in the Exploration Stage (as defined by
SEC Industry Guide 7) as it has no Proven or Probable Reserves within the
meaning of SEC Industry Guide 7. Under US GAAP, for a property that has no
Proven or Probable Reserves, the Company capitalizes the cost of acquiring the
property (including mineral properties and rights) and expenses all costs
related to the property incurred subsequent to the acquisition of such property.
Acquisition costs of a property are depreciated over its estimated useful life
for a revenue generating property or expensed if the property is sold or
abandoned. Acquisition costs are subject to impairment if so indicated.

110

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Outlook

With the June 2015 acquisition of Uranerz, which includes the
Nichols Ranch Project, Energy Fuels has increased its flexibility to adjust its
recovery of uranium to respond to market conditions and to meet the requirements
of its sales contracts. As a result, the Company has expanded its ability to
bring additional uranium extraction and recovery on line within months after a
decision is made. This allows the Company to efficiently fulfill its existing
commitments and commit to new spot and term sales that will be sourced from
uranium recovered from the Companys facilities. The Company plans to extract
and/or recover uranium from the following sources in 2016 (each of which is more
fully described below):

| | 1) | Nichols Ranch Project;                                       
| | -- | -------------------------------------------------------------
| | 2) | Alternate feed materials; and                                
| | 3) | Pinenut Project material that is available for
      milling.

In response to continued uranium price weakness and market
uncertainty, the Company expects to continue cash conservation efforts until
such time that sustained improvement in uranium market conditions is observed.
In addition, the Company is continuing to manage its activities and assets
conservatively, maintaining its substantial uranium resource base and its ISR
and conventional uranium extraction and recovery capabilities, and only
scheduling recovery at the White Mesa Mill and the Nichols Ranch Project as
market conditions, availability of mill feed, cash needs, and/or contract
delivery requirements may warrant.

The Company will continue to evaluate acquisition opportunities
that may arise.

Extraction and Recovery Activities  Overview

The Company expects to recover approximately 950,000 pounds of
finished U3O8 for the year ending December 31, 2016, as further described below.

The Company currently has finished goods inventory and uranium
extraction and recovery capabilities that exceed the commitments contained in
its existing sales contracts. As a result, both ISR and conventional uranium
extraction and/or recovery have been, and are expected to continue to be,
maintained at conservative levels until such time as market conditions improve
sufficiently and/or the Company requires cash to meet its business needs. This
allows the Company to maintain its mineral resources for future sales at price
levels that we expect to be higher than current levels and, accordingly, to be
able to achieve the benefit of expected future uranium price increases.

Extraction and Recovery  ISR Uranium Segment

The Company expects the Nichols Ranch Project to extract and
recover approximately 350,000 pounds of finished
U3O8for the year ending December 31, 2016.

At December 31, 2015, the Nichols Ranch Wellfields had six
header houses extracting uranium. The Company plans to complete three additional
header houses by the end of 2016. The Company has completed all monitor wells in
Production Area #2.

In February 2016, the Company completed construction of the
elution circuit and began the elution process at the Nichols Ranch Plant.
Yellowcake slurry from this circuit will be shipped to our White Mesa Mill for
final yellowcake drying, packaging, and shipment to a conversion facility.

Permitting of the adjacent Jane Dough Property is continuing
and is expected to be completed in advance of our need to begin wellfield
construction. Also, the Hank Project is fully permitted to be constructed as a
satellite facility to the Nichols Ranch Plant.

Extraction and Recovery  Conventional Uranium Segment

The Company expects the White Mesa Mill to recover
approximately 600,000 pounds of finished U3O8 for
the year ending December 31, 2016.

The Company is planning to recover approximately 350,000 pounds
of U3O8 which was extracted from its Pinenut
Project. Shipment of this material to the Mill was completed in March 2016. The
Pinenut Project is now fully depleted, and the Company has commenced reclamation
activities.

111

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During 2016, the Company also expects to recover approximately
250,000 pounds of U3O8 from alternate feed materials.

The White Mesa Mill has historically operated on a campaign
basis, whereby uranium recovery is scheduled as mill feed, cash needs, contract
requirements, and/or market conditions may warrant. Once the processing for 2016
concludes (expected to be in late 2016), the Company expects to place uranium
recovery activities at the Mill on standby until additional mill feed becomes
available. The Mill will dry and package material from the Nichols Ranch Plant
and continue to receive and stockpile alternate feed materials for future
milling campaigns. Each future milling campaign will be subject to receipt of
sufficient mill feed that would allow the Company to operate the Mill on a
profitable basis and/or recover a portion of its standby costs.

The Company has re-started shaft sinking activities at the
Canyon Project and has completed the installation of new equipment and
infrastructure to optimize shaft sinking rates and realize construction cost
savings. Once the shaft depth approaches the mineralized zone, we plan to
complete additional exploration drilling to further evaluate the deposit. The
timing of our plans to extract and process mineralized materials from this
project will be based on the results of this additional evaluation work, along
with market conditions, available financing, and sales requirements.

The Company expects to continue to pursue permitting activities
at certain of its conventional projects, including the Roca Honda Project and
the Sheep Mountain Project. The Company will also continue to evaluate the
Bullfrog Property at its Henry Mountains Project. Expenditures for certain of
these projects have been adjusted to coincide with expected dates of price
recoveries based on our forecasts.

Finally, the Company plans to continue to maintain, and update
as necessary, all permits on its standby properties. These properties will
remain on standby until market conditions improve such that the material can be
sold at prices that support extraction. The Company also plans to continue to
evaluate its non-core properties for sale or abandonment in order to reduce
costs and/or receive value for these properties. The Company is continuing to
monitor corporate and field overhead to reflect the lower levels of activity.

Sales

For 2016, the Company forecasts sales under its existing
long-term contracts to total approximately 550,000 pounds of
U3O8. The prices for material sold under the existing
long-term contracts is either fixed or at floors. The averagesales
price under the Companys long-term contracts is expected to be higher in 2016
than 2015 levels. The Company expects to complete these sales from both
U3O8already in inventory or expected to be recovered
from its planned activities discussed above.

The Company is currently monitoring market conditions for
additional sales opportunities. Selective spot sales are expected to be made as
necessary to generate cash for operations and development activities.

In 2017, the Company expects to have existing inventory or
expected production to meet all of its commitments to sell 620,000 pounds of
uranium under its existing long-term contracts at average sales prices higher
than 2015 levels.

The Company also continues to pursue new sources of revenue,
including expansion of its alternate feed business.

Results of Operations

The following table summarizes the results of operations for
the years ended December 31, 2015, 2014 and 2013 (in thousands of dollars):

112

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|                                                                        |   | YearsendedDecember31, |  
|----------------------------------------------------------------------- | - | --------------------- | -
|                                                                        |   | 2015                  |  
|Revenue                                                                 | $ | 61,351                |  
|Costsandexpensesapplicabletorevenue                                     |   | 37,617                |  
|Impairmentofinventories                                                 |   | -                     |  
|GrossProfit                                                             |   | 23,734                |  
|                                                                        |   |                       |  
|Otheroperatingcostsandexpenses                                          |   |                       |  
|Development, permitting and land holding                                |   | 8,762                 |  
|Stand by costs                                                          |   | 10,765                |  
|Accretion
      of asset retirement obligation                          |   | 494                   |  
|Total other operating costs and expenses                                |   | 20,021                |  
|                                                                        |   |                       |  
|Selling,general&administration                                          |   |                       |  
|Selling
      costs                                                     |   | 316                   |  
|Intangible asset
      amortization                                     |   | 5,364                 |  
|General
      and administration                                        |   | 12,325                |  
|Costs directly
      attributable to acquisitions                       |   | 6,886                 |  
|Total selling, general & administration                                 |   | 24,891                |  
|                                                                        |   |                       |  
|Operatinglossbeforeimpairment                                           |   | (21,178               | )
|                                                                        |   |                       |  
|Impairmentofgoodwillandproperty,plantandequipment                       |   |                       |  
|Impairment of property,
      plant and equipment and mineral propertie |   | 10,994                |  
|Impairment of goodwill                                                  |   | 47,730                |  
|Impairment                                                              |   | 58,724                |  
|                                                                        |   |                       |  
|TotalOperatingLoss                                                      |   | (79,902               | )
|Interest expense                                                        |   | (2,035                | )
|Other income (expense)                                                  |   | (420                  | )
|Income tax expense                                                      |   | -                     |  
|Netloss                                                                 | $ | (82,357               | )
|                                                                        |   |                       |  
|Basicanddilutedlosspershare                                             | $ | (2.46                 | )

Impairment of Goodwill, and Property Plant and Equipment and
Mineral Properties

Beginning in July 2012 market prices for uranium began a
gradual decline from a spot price of $50.75 at June 30, 2012 to a low of $28.10
per pound in June 2014. Although prices recovered to $44.00 per pound in
November 2014, they have fallen back to the current spot price of  $28.75 per pound as at March 11, 2016 as
reported by Trade Tech. The Company, as well as many other uranium producers and
analysts, had expected uranium prices to have recovered by now. While we
continue to believe the market will recover, uranium prices have not yet
improved as expected.

In response to the decline in market prices and the continued
uncertainty in the expected recovery of prices, Energy Fuels has cut back its
activities by: (i) placing various properties on standby, which reduces the
throughput at the White Mesa Mill; (ii) curtailing or reducing certain
exploration, permitting, and evaluation activities; and (iii) selling or
abandoning certain non-core properties that we feel are not of value to our
continuing operations. As a result, the Companys variable levels of uranium
recovery activities over time make period-to-period changes not comparable.

113

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On June 18, 2015, the Company recorded Goodwill of $47.73
million associated with the acquisition of Uranerz on that date. The Goodwill
was a result of the value of the equity consideration given up to acquire
Uranerz, which was in excess of the value of the assets acquired, net of
obligations assumed and was valued at the closing price on the day of the
acquisition ($4.16 per share). Since
the acquisition of Uranerz, uranium prices have fallen about 20%, and
considerable uncertainty remains as to the timing of a uranium price recovery.
In addition, the value of our shares and related market capitalization has
decreased significantly due to a number of factors. As a result, the Company has
evaluated the acquisition value of the Goodwill at December 31, 2015 and
determined that the Goodwill should be fully impaired.

Also, in December 2015, as a result of the uranium market
factors discussed above, the Company made the decision to sell or abandon
certain non-core mineral resource properties that it felt were not essential to
its future operations in order to save costs and/or receive value for these
properties. These properties are currently being marketed for sale. A total of
$10.99 million of our mineral resource properties were impaired based on our
review of the properties and their associated carrying values.

In the year ended December 31, 2014, as a result of the factors
discussed above, the Company evaluated the carrying value of the property, plant
and equipment and mineral properties acquired in the purchase of the US Mining
Division of Denison and determined to recognize an impairment of the carrying
values of those assets. Additionally, certain other properties owned by the
Company were offered for sale, at which time such properties were determined to
be impaired. These impairments totaled $80.07 million.

Future uranium prices are uncertain. In the event prices do not
improve as expected by the Company, the Company may have additional impairments
in the future and such impairments may be material.

Results of Operations

Year ended December 31, 2015 compared to year ended
December 31, 2014

For the year ended December 31, 2015 the Company recorded a net
loss of $82.36 million or $2.46 per share compared with a loss of $86.64 million
or $4.41 per share for the year ended December 31, 2014, which included
impairment losses totaling $58.72 million and $80.07 million, respectively, as
discussed above.

For the year ended December 31, 2015, the Company recorded an
operating loss before impairment of $21.18 million compared with an operating
loss before impairment of $6.21 million for the year ended December 31,
2014.

Revenues

The Companys revenues from uranium are largely based on
delivery schedules under long-term contracts, which can vary from quarter to
quarter.

Revenues for the year ended December 31, 2015 totaled $61.35
million compared with $46.25 million in the year ended December 31, 2014.

Revenues for the year ended December 31, 2015 totaled $61.35
million, of which $60.70 million were sales of 1,075,000 pounds of
U3O8, which included the sale of 1,025,000 pounds of
U3O8 pursuant to term contracts at an average price
of $57.39 per pound and the sale of 50,000 pounds of
U3O8 on the spot market at a price of $37.35 per
pound.

Sales related to the Conventional Uranium Segment totaled
850,000 pounds of U3O8, of which 800,000 pounds of
U3O8 were under long-term contracts at an average
price of $57.41 and 50,000 pounds of U3O8 were from
spot sales at a price of $37.35 per pound. Included in the sales under contract
for the Conventional Uranium Segment for the year ended December 31, 2015 were
350,000 pounds of U3O8, which were the final contractual
deliveries under one of our sales contracts.

Sales related to the ISR Uranium Segment for the period from
the date of acquisition of Uranerz (June 18, 2015) to December 31, 2015 totaled
225,000 pounds of U3O8 all of which were under
long-term contracts at an average price of $56.46 per pound. Included in the
sales under contract for the ISR Uranium Segment for this period were 75,000
pounds of U3O8 which were the final contractual
deliveries under one of our sales contracts.

114

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Revenues for the year ended December 31, 2014 totaled $46.25
million, of which $45.76 million were sales of 800,000 pounds of uranium
concentrates, all of which were pursuant to long term contracts at an average
price of $57.19 per pound and related to the Conventional Uranium Segment.

Operating Expenses

Uranium recovered and costs and expenses applicable to
revenue

In the year ended December 31, 2015, the Company recovered
468,000 pounds of U3O8 of which 72,000 pounds of
U3O8 were for the account of a third party under
processing agreements.Uranium recovered for its own account included
approximately 172,000 pounds from its new ISR Uranium Segment for the period
from acquisition (June 18, 2015 through December 31, 2015), 199,000 pounds were
from alternate feed sources and 25,000 pounds were from conventional feed
material from our Conventional Uranium Segment.

In the year ended December 31, 2014, the Company recovered
943,000 pounds of U3O8 (all were from the
Conventional Uranium Segment) of which 85,000 pounds of
U3O8 were for the account of a third party under a
processing agreement. Uranium recovered for its own account included 306,000
pounds from alternate feed sources and 552,000 pounds from conventional feed
material from its Arizona uranium extraction operations. Uranium recovered from
the Conventional Uranium Segment in the year ended December 31, 2015 compared
with the year ended December 31, 2014 declined primarily due to the lower
amounts of available feed material for the mill.

Costs and expenses applicable to revenue for the year ended
December 31, 2015 totaled $37.62 million, compared with $29.91 million for the
year ended December 31, 2014. The increase in the cost of sales was primarily
attributable to the increase in the quantity of U3O8sold year over year as discussed above. Costs of goods sold averaged
$34.99 per pound and $37.38 per pound in the years ended December 31, 2015 and
2014, respectively.

Other operating costs and expenses

Development, permitting and land
holding

For the year ended December 31, 2015, the Company spent $8.76
million for development, permitting, and land holding primarily related to wellfield construction and partial construction of the elution circuit at the
Nichols Ranch Project. While we expect the amounts expensed relative to our
wellfield construction and the elution circuit will add value to the Company, we
expense these amounts as we do not have proven or probable reserves at the
Nichols Ranch Project under SEC Industry Guide 7. For the year ended December
31, 2014, we spent $1.49 million primarily on permitting and land holding for
our conventional assets.

Standby expense

The Companys La Sal and Daneros Projects were placed on
standby in the last quarter of calendar year 2012, as a result of market
conditions. In February 2014, the Company placed its Arizona 1 Project on
standby. In 2015, the White Mesa Mill was operated at lower levels of uranium
recovery, including prolonged periods of standby. Costs related to the care and
maintenance of the standby mines, along with standby costs incurred while the
White Mesa Mill was operating at low levels of uranium recovery or on standby,
are expensed.

For the year ended December 31, 2015, standby costs totaled
$10.77 million compared with $5.14 million in the prior year. The increase is
primarily related to increased standby costs at the White Mesa Mill, due to
lower uranium recovery levels resulting from an increased amount of time the
Mill was on standby. In 2016, while the mill is expected to have increased
levels of activity compared with 2016, it will continue to have periods of low
activity and standby.

Accretion

Accretion related to the asset retirement obligation for the
Companys properties increased for the year ended December 31, 2015 ($0.49
million) compared with the prior year ($0.41 million) primarily due to the
increase in the amount of the asset retirement obligation added in connection
with the Uranerz acquisition.

115

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Selling, General, and Administrative

Selling, general, and administrative expense includes costs
associated with marketing uranium, corporate general and administrative costs,
and non-cash costs of amortization of above-market sales contract value
associated with the acquisition of Denisons US Mining Division in June 2012 and
the Uranerz acquisition in June 2015. General and administrative expenses
consist primarily of payroll and related expenses for personnel, contract and
professional services, stock-based compensation expense and other overhead
expenditures. Selling, general and administrative expenses totaled $24.89
million for the year ended December 31, 2015 compared to $15.51 million for the
year ended December 31, 2014. The increase is a result of higher amortization of
intangible asset amortization ($5.36 million compared with $3.89 million) as a
result of the higher level of term sales discussed above, costs related to the
acquisition of Uranerz in 2015 ($6.89 million) and an overall increase in the
level of general and administrative expense ($12.33 million compared with $11.34
million) due to the increase in the size of the organization resulting from the Uranerz acquisition.

Interest Expense and Other Income and Expenses

Interest Expense

Interest expense for the year ended December 31, 2015 was $2.04
million compared with $1.69 million in the prior year. The increase is primarily
due to interest on the $18.81 million in debt assumed from the June 2015 Uranerz
acquisition.

Other income and expense

For the year ended December 31, 2015, other income and expense
totaled $0.42 million expense. These amounts consist of a change in the
mark-to-market values of the Companys Debentures of $1.55 million, partially
offset by a change in the value of derivative liabilities related to warrants of
$0.59 million and other income amounts totaling $0.54 million.

Other income and expense for the year ended December 31, 2014
totaled $1.44 million income and consisted of a change in the mark-to-market
values of the Companys Debentures totaling $0.30 million and a gain on sale of
mineral properties totaling $0.57 million, along with other miscellaneous
items.

Year ended December 31, 2014 compared to year ended
December 31, 2013

For the year ended December 31, 2014, the Company recorded a
net loss of $86.64 million or $4.41 per share compared with a net loss of $36.59
million or $2.27 per share or the year ended December 31, 2013 which included
impairment losses on long-term assets of $80.07 million and nil, respectively,
as discussed above.

For the year ended December 31, 2014, the Company recorded an
operating loss before impairment of $6.21 million compared with an operating
loss of $33.34 million for the year ended December 31, 2013.

Revenues

The Companys revenues from uranium are largely based on
delivery schedules under long-term contracts, which can vary from quarter to
quarter.

Revenues for the year ended December 31, 2014 totaled $46.25
million compared with $64.32 million in the year ended December 31, 2013. All
revenues earned in these years were from our Conventional Uranium Segment.

Revenues for the year ended December 31, 2014 totaled $46.25
million, of which $45.76 million were sales of 800,000 pounds of uranium
concentrates, all of which were pursuant to term contracts at an average price
of $57.19 per pound.

Revenues for the year ended December 31, 2013 totaled $64.32
million, of which $55.30 million were sales of uranium concentrates, which
included the sale of 840,000 pounds of U3O8 pursuant to
term contracts at an averageprice of $56.25 per pound 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 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, as the Company
provided a discount on portions of its long-term contract deliveries in the
years 2015 through 2017 to this customer.

116

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Revenues for the year ended December 31, 2013 also included the
sale of $8.78 million of vanadium in the form of V2O5 and
ferrovanadium.There were no vanadium sales in the twelve months ended December
31, 2014, as the Company was not producing vanadium at that time.

Operating Expenses

Uranium recovered and production costs and expenses
applicable to revenue

In the year ended December 31, 2014, the Company recovered
943,000 pounds of U3O8 of which 85,000 pounds of
U3O8 were for the account of a third party under
processing agreements. Uranium recovered for its own account included 306,000
pounds from alternate feed sources and 552,000 pounds from conventional feed
material from its Arizona uranium extraction operations.

In the year ended December 31, 2013, the Company recovered
1,007,000 pounds of U3O8 which were all for its own
account. Uranium recovered included 351,000 pounds from alternate feed sources
and 655,000 pounds from conventional feed material from its Arizona 1, La Sal
and Daneros uranium extraction operations. Uranium recovered from the
Conventional Uranium Segment in the year ended December 31, 2014 compared with
the year ended December 31, 2013 declined primarily due to the lower amounts of
available feed material for the mill and processing schedules.

Costs and expenses applicable to revenue for the year ended
December 31, 2014 totaled $29.91 million, compared with $55.87 million for the
year ended December 31, 2013. The decrease in the cost of sales was primarily
attributable to the decrease in the pounds sold year over year as discussed
above and cost related to the sale of vanadium totaling $8.28 million in 2013.
There were no vanadium sales in 2014. Costs of goods sold for uranium averaged
$37.35 per pound and $45.76 per pound in the years ended December 31, 2014 and
2013, respectively. The higher cost per pound in 2013 compared with 2014 is
primarily attributable to the sale of significant pounds of uranium purchased in
the Denison transaction which had been valued at market value at the time of
purchase. Additionally, the Company recorded an impairment of inventories
totaling $2.92 million in the year ended December 31, 2013.

Other operating costs and expenses

Development, permitting and land
holding

For the year ended December 31, 2014 the Company spent $1.49
million for development, permitting and land holding. For the year ended
December 31, 2013, we spent $11.92 million primarily related to pre-extraction
construction activities related to the Pinenut Project as well as permitting and
land holding.

Standby expense

The Companys La Sal and Daneros Projects were placed on
standby in the last quarter of calendar year 2012, as a result of market
conditions. In February 2014, the Company placed its Arizona 1 Project on
standby. Costs related to the care and maintenance of these and other standby
properties are expensed.

For the year ended December 31, 2014 standby costs totaled
$5.14 million compared with $5.01 million in the prior year.

Selling, General and Administrative

Selling, general and administrative expense includes costs
associated with marketing uranium and vanadium, the corporate general and
administrative costs, and the non-cash costs of amortization of above-market
sales contract value associated with the acquisition of Denisons US Mining
Division in June 2012. General and administrative expenses consist primarily of
payroll and related expenses for personnel, contract and professional services,
stock-based compensation expense and other overhead expenditures. Selling,
general and administrative expenses totaled $15.51 million for the year ended
December 31, 2014 compared to $21.66 million for the year ended December 31,
2013. This decrease year over year is a result of lower amortization of
intangible asset amortization ($3.89 million in 2014 compared with $5.34 million
in 2013) as a result of the lower level of term sales discussed above, one-time
costs related to the acquisition of Strathmore in 2013 ($2.42 million), lower
selling expenses ($0.28 million compared with $1.07 million) primarily as a
result of no vanadium sales in 2014 and an overall decrease in the level of general and administrative expense ($11.34 million compared
with $12.83 million) due to decreased acquisition activities in 2014.

117

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Interest Expense and Other Income and Expenses

Interest Expense

Interest expense for the year ended December 31, 2014 was $1.69
million compared with $1.47 million in the prior year.

Other income and expense

Other income and expense for the year ended December 31, 2014
totaled income of $1.44 million and consists of a change in the mark-to-market
values of the Debentures totaling $0.30 million and a gain on sale of mineral
properties totaling $0.56 million along with other miscellaneous items.

For the year ended December 31, 2013, other income and expense
totaled an expense of $1.75 million. These amounts consist of a change in the
mark-to-market value of the Companys investment in Virginia Energy Resources
totaling $3.14 million partially offset by a change in the mark-to-market values
of the Debentures totaling $0.69 million, interest income of $0.46 million and a
gain on foreign exchange of $0.30 million.

LIQUIDITY AND CAPITAL RESOURCES

Funding of major business and property acquisitions

Over the past four years the Company has funded major business
and property acquisitions with capital provided by issuance of its common shares.
In 2012 we acquired Titan Uranium Inc. and the US Mining Division of Denison, in
2013 we acquired Strathmore Minerals Corp. and in 2015 we acquired Uranerz each
in exchange for newly issued shares. We intend to continue to acquire assets
utilizing common shares when we can do so under attractive terms.

We also intend to complete the acquisition of Mesteña in 2016
through the issuance of 4.55 million shares and pay advisor fees with shares.
Additionally, we expect to complete the purchase of the 40% interest in Roca
Honda from Sumitomo using part cash, part common shares, also as discussed
above.

Cash issued for shares and warrants

In the fourth quarter of 2015 we sold 1.28 million shares for
net proceeds of $2.63 million and in the first quarter of 2016 we sold 0.20
million shares for net proceeds of $0.52 million under our ATM Offering.
Additionally, on March 14, 2016 we closed an equity offering of 5,031,250 units
(each unit consisting of one share and one half warrant) for net proceeds of
$10.88 million after commissions and estimated expenses of the offering.

Working capital at December 31, 2015

At December 31, 2015, the Company had working capital of $34.86
million, including $12.97 million in cash and 520,000 pounds of finished goods
inventory. The Company believes it has sufficient cash and resources to carry
out its business plan beyond 2016.

The Company manages liquidity risk through the management of
its capital structure. Accounts payable and accrued liabilities, current portion
of notes payable and current taxes payable are due within the current operating
year.

Cash and cash flow

Year ended December 31, 2015

Cash and cash equivalents were $12.97 million at December 31,
2015, compared to $10.41 million at December 31, 2014. The increase of $2.56
million was due primarily to cash provided by investing activities of $3.43
million and financing activities of $1.39 million, partially offset by cash
used in operations of $2.08 million and loss on foreign exchange on cash held of
$0.18 million.

118

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Net cash provided by investing activities was $3.43 million,
which was primarily related to cash received of $5.27 million from a reduction
in the collateral required to secure mine and mill reclamation bonds posted by
the Company and $2.46 million cash acquired in the Uranerz acquisition,
partially offset by expenditures for mineral properties and property, plant and
equipment of $4.30 million.

Net cash provided by financing activities totaled $1.39 million
consisting primarily of $2.81 million proceeds from the issuance of stock in the
ATM Offering and for exercise of options and warrants, cash received from
non-controlling interests of $0.30 million, partially offset by $1.73 million to
repay loans and borrowings.

Net cash used in operating activities of $2.08 million is
comprised of the net loss of $82.36 million for the period adjusted for non-cash
items and for changes in working capital items. Significant items not involving
cash were a $47.73 million impairment of goodwill, $10.99 million impairment of
property, plant and equipment and mineral properties and $7.79 million
depreciation and amortization of property, plant and equipment and intangible
assets.

Year ended December 31, 2014

Cash and cash equivalents were $10.41 million at December 31,
2014, compared to $6.63 million at December 31, 2013. The increase of $3.78
million was due primarily to cash provided by investing activities of $11.14
million and financing activities of $0.47 million, partially offset by cash used
in operations of $7.69 million and loss on foreign exchange on cash held of
$0.13 million.

Net cash provided by investing activities was $11.14 million,
which was primarily related to cash received of $9.33 million from a reduction
in the collateral required to secure mine and mill reclamation bonds posted by
the Company, cash received from the sale of property, plant and equipment of
$2.00 million, proceeds from sale of marketable securities of $0.40 million, and
cash received on assets held for sale of $0.23 million, partially offset by
expenditures for property, plant and equipment of $0.82 million.

Net cash provided by financing activities totaled $0.47 million
consisting primarily from the issuance of common shares for cash and cash
received from the exercise of warrants and options.

Net cash used in operating activities of $7.69 million is
comprised of the net loss of $86.64 million for the period adjusted for non-cash
items and for changes in working capital items. Significant items not involving
cash were a $80.07 million impairment of property, plant and equipment and a
$6.80 million depreciation and amortization of property, plant and equipment and
intangible assets.

Contractual Obligations

The following table summarizes our contractual obligations as
of December 31, 2015.

119

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|                                                                                         |   | Payments due by period - $000 | 
|---------------------------------------------------------------------------------------- | - | ----------------------------- | 
|                                                                                         |   |                               | 
|                                                                                         |   | Total                         | 
|Long-term debt obligations - principal payable in cash                                   | $ | 17,598                        | 
|Interest on long-term debt obligations                                                   |   | 4,721                         | 
|Capital lease obligations                                                                |   | 52                            | 
|Operating lease obligations                                                              |   | 1,063                         | 
|Purchase obligations                                                                     |   | 1,159                         | 
|Deferred income                                                                          |   | 2,165                         | 
|Decommissioning liabilities (undiscounted)                                               |   | 32,300                        | 
|Subtotal - payable in cash                                                               |   | 59,058                        | 
|Long-term obligations - principal payable in cash or common shares at Company discretion |   | 14,624                        | 
|Total contractual obligations                                                            | $ | 73,682                        | 

In addition, the Company enters into commitments with federal
and state agencies and private individuals to lease surface and mineral rights.
These leases are renewable annually and are expected to total $1.52 million for
the year ended December 31, 2016.

Critical accounting estimates and judgments

The preparation of these consolidated financial statements in
accordance with US GAAP 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.

Significant estimates made by management include:

a.Exploration Stage

SEC Industry Guide 7 defines a reserve as that part of a
mineral deposit which could be economically and legally extracted or produced at
the time of the reserve determination. The classification of a reserve must be
evidenced by a bankable feasibility study using the latest three-year price
average. While the Company has established the existence of mineral resources
and has successfully extracted and recovered saleable uranium from certain of
these resources, the Company has not established proven or probable reserves, as
defined under SEC Industry Guide 7, for these operations or any of its uranium
projects. As a result, the Company is in the Exploration Stage as defined under
Industry Guide 7. Furthermore, the Company has no plans to establish proven or
probable reserves for any of its uranium projects.

While in the Exploration Stage, among other things, the Company
must expense all amounts that would normally be capitalized and subsequently
depreciated or depleted over the life of the mining operation on properties that
have proven or probable reserves. Items such as the construction of wellfields
and related header houses, additions to our recovery facilities and advancement
of properties will all be expensed in the period incurred. As a result, the
Companys consolidated financial statements may not be directly comparable to
the financial statements of mining companies in the development or production
stages.

b.Resource estimates utilized

The Company utilizes estimates of its 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 resources is based upon factors such as estimates
of future uranium prices, future construction and operating costs along with
geological assumptions and judgments made in estimating the size and grade of
the resource. Changes in the mineral resource estimates may impact the carrying
value of mining and recovery assets, goodwill, reclamation and remediation
obligations and depreciation and impairment.

c.Valuation of mining and recovery
assets in a business combination

120

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We value assets in a business combination based on our
estimates of the fair value of the mining and recovery assets acquired.

For mining and recovery assets actively extracting and
recovering uranium as well as those assets that we expect to extract uranium
from, we value the assets based on the income approach. As we have not acquired
proven or probable reserves in our business combinations the value ascribed to
these assets is based on our estimates of value beyond proven and probable
reserves. The value is calculated based, in part, on technical reports prepared
under NI 43-101. Our estimates of extraction and recovery activities and related
timing of extraction and recovery as well as the costs involved are demonstrated
by at least a preliminary economic assessment. We then adjust the results of the
technical reports to include the effects of anticipated fluctuations in the
future market price of uranium consistent with what we believe to be the
expectations of other market participants as well as any expected operational or
cost changes that we expect in the future operations of these mining assets.
These cash flow estimates include the estimated cash outflows to develop,
extract and recover the estimated saleable U3O8 from
these operations.

For mining assets that will be held for further evaluation or
for sale, we use the market approach utilizing implied transaction multiples
from historical uranium interests transactions.

d.Valuation of mining assets
acquired other than in a business combination

The costs of mining assets that are acquired in an asset
purchase transaction are recorded as mineral interests on the date of purchase
based on the consideration given up for the assets. If multiple assets are
involved in a transaction, the consideration is allocated based on the relative
values of the properties acquired.

e.Depreciation of mining and
recovery assets acquired

For mining and recovery assets actively extracting and
recovering uranium we depreciate the acquisition costs of the mining and
recovery assets on a straight line basis over our estimated lives of the mining
and recovery assets. The process of estimating the useful life of the mining and
recovery assets requires significant judgment in evaluating and assessing
available geological, geophysical, engineering and economic data, projected
rates of extraction and recovery, 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 mining and recovery assets and the recorded amount of
depreciation.

f.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. See
b.above for information related to the valuation of mining and recovery
assets in this process.

g.Impairment testing of mining and
recovery assets and goodwill

The Company undertakes a review of the carrying values of its
mining and recovery assets 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 net cash
flows. An impairment loss is recognized when the carrying value of a mining or
recovery asset is not recoverable based on this analysis. In undertaking this review, the management of
the Company is required to make significant estimates of, among other things,
future production and sale volumes, forecast commodity prices, future operating
and capital costs and reclamation costs to the end of the mining asset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 mining and recovery assets.

121

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For goodwill, the Company compares the fair value of the
reporting unit (the Nichols Ranch Project) with its carrying value including
goodwill. If the fair value of the reporting unit is less than the carrying
value including goodwill, the implied value of the goodwill is compared with its
carrying amount. If the implied value of the goodwill is less than the carrying
value an impairment loss is recognized for the difference.

h.Asset retirement obligations

Asset retirement obligations are recorded as a liability when
an asset that will require reclamation and remediation is initially acquired.
For disturbances created on a property owned that will require future
reclamation and remediation the Company records asset retirement obligations for
such disturbance when occurred. 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. Additionally, the expected
cash flows in the future are discounted at the Companys estimated cost of
capital based on the periods the Company expects to complete the reclamation and
remediation activities. Differences in the expected periods of reclamation or in
the discount rates used could have a material difference in the actual
settlement of the obligations compared with the amounts provided.

i.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.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK

The Company is exposed to risks associated with commodity
prices, interest rates and credit. Commodity price risk is defined as the
potential loss that we may incur as a result of changes in the market value of
uranium. Interest rate risk results from our debt and equity instruments that we
issue to provide financing and liquidity for our business. Credit risk arises
from the extension of credit throughout all aspects of our business.
Industry-wide risks can also affect our general ability to finance exploration,
and development of exploitable resources; such effects are not predictable or
quantifiable. Market risk is the risk to the Company of adverse financial impact
due to change in the fair value or future cash flows of financial instruments as
a result of fluctuations in interest rates and foreign currency exchange
rates.

Commodity Price Risk

The Company is subject to market risk related to the market
price of U3O8. Our four supply contracts contain
favorable pricing above current spot prices; however, these long term prices
cover only a portion of our planned uranium recovery. Revenue beyond our current
contracts will be affected by both spot and long-term
U3O8 price fluctuations which are beyond our
control, including: the demand for nuclear power; political and economic
conditions; governmental legislation in uranium producing and consuming
countries; and production levels and costs of production of other producing
companies. The Company continuously monitors the market to determine  its level of extraction and recovery of uranium in the future.

Interest Rate Risk

The Company is exposed to interest rate risk on its cash
equivalents, deposits, restricted cash, and debt. Our interest earned is not
material; thus not subject to significant risk. Our Wyoming Industrial
Development Revenue Bond has a fixed interest rate over its remaining five year
life, removing variability. The Company is exposed to an interest rate risk
associated with the Debentures, which is based on the spot market price of
U3O8. These debentures mature in June 2017. The Company
does not expect the spot market price of U3O8 to
exceed $54.99 prior to the debentures maturity and, accordingly, does not believe there
is any significant interest rate risk related to these debentures. The Company
does not use derivatives to manage interest rate risk. The following chart
displays the interest rate applicable to our convertible debentures at various
U3O8 price levels.

122

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UxCU3O8WeeklyIndicatorPrice
    AnnualInterestRateUp 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%


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. As the US Dollar is the functional currency of our U.S. operations, the
currency risk has been reduced. We maintain a nominal balance in foreign
currency, resulting in a low currency risk relative to our cash balances. Our
Debentures are denominated in Canadian Dollars and, accordingly, are exposed to
currency risk.

The following table summarizes, in United States dollar
equivalents, the Companys major foreign currency (Cdn$) exposures as of
December 31, 2015 ($000):

Cash and cash equivalents
    $
    559Accounts payable and accrued liabilities
    
    (784
    )Loans and borrowings
    
    14,624Total
    $
    14,398


The table below summarizes a sensitivity analysis for
significant unsettled currency risk exposure with respect to our financial
instruments as at December 31, 2015 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)inotherSensitivity Analysis
    comprehensiveincome
    ($000)Strengthening net earnings
    +1% change in U.S. dollar
    $199Weakening net earnings
    -1% change in U.S. dollar
    ($199)


123

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Credit Risk

Credit risk relates to cash and cash equivalents, trade, and
  other receivables that arise 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 multinational utilities. As at December 31, 2015, the
  Companys maximum exposure to credit risk was the carrying value of cash
  and cash equivalents, trade receivables and taxes recoverable.

124

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ENERGY FUELS INC.

CONSOLIDATED FINANCIAL STATEMENTS December 31, 2015
Contents

|Report of
    Independent Registered Public Accounting Firm                                                                                     | F-1
|----------------------------------------------------------------------------------------------------------------------------------------------- | ---
|Financial Statements:                                                                                                                           |    
|Consolidated Statements of Operations and Comprehensive Loss for the years
    ended December 31, 2015, December 31, 2014 and December 31, 2013 | F-2
|Consolidated
    Balance Sheets at December 31, 2015 and December 31, 2014                                                                      | F-3
|Consolidated Statements of Changes in Equity for the
    years ended December 31, 2015, December 31, 2014 and December 31, 2013                 | F-4
|Consolidated Statements of Cash Flows for the years ended
    December 31, 2015, December 31, 2014 and December 31, 2013                        | F-5
|Notes to the Consolidated Financial Statements                                                                                                  | F-6

125

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders
Energy Fuels Inc.:

We have audited the accompanying consolidated balance sheets
of Energy Fuels Inc. as of December 31, 2015 and December 31, 2014, and the
related consolidated statements of operations and comprehensive loss, changes in
shareholders equity and cash flows for each of the years in the three-year
period ended December 31, 2015. These consolidated financial statements are the
responsibility of Energy Fuels Inc.'s management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.

We conducted our audits in accordance with the standards of
the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements
referred to above present fairly, in all material respects, the financial
position of Energy Fuels Inc. as of December 31, 2015 and December 31, 2014, and
the results of its operations and its cash flows for each of the years in the
three-year period ended December 31, 2015, in conformity with U.S. generally
accepted accounting principles.



/s/ KPMG LLP
Chartered Professional Accountants, Licensed Public
Accountants 
March 15, 2016
Toronto, Canada

| | KPMG
    LLP is a Canadian limited liability partnership and a member firm of the
    KPMG 
    network of independent member firms affiliated with KPMG International
    Cooperative 
    (KPMG International), a Swiss entity. | 
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 

F-1

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Consolidated Statements of Operations and Comprehensive
      Loss    
|(Expressed in
      thousands of US dollars, except per share amounts)

|                                                                                  |   | For the years ended December 31, |  
|--------------------------------------------------------------------------------- | - | -------------------------------- | -
|                                                                                  |   | 2015                             |  
|                                                                                  |   |                                  |  
|Revenue (Note 16)                                                                 | $ | 61,351                           |  
|Costs and expenses applicable to revenue                                          |   | 37,617                           |  
|Impairment of inventories                                                         |   | -                                |  
|Development, permitting and land holding                                          |   | 8,762                            |  
|Standby costs                                                                     |   | 10,765                           |  
|Accretion of asset retirement obligation                                          |   | 494                              |  
|Selling costs                                                                     |   | 316                              |  
|Intangible asset amortization                                                     |   | 5,364                            |  
|General and administration                                                        |   | 12,325                           |  
|Costs directly attributable to acquisitions                                       |   | 6,886                            |  
|Impairment of plant and equipment and
      mineral properties (Note 9)           |   | 10,994                           |  
|Impairment
      of goodwill (Note 9)                                             |   | 47,730                           |  
|Total operating loss                                                              |   | (79,902                          | )
|                                                                                  |   |                                  |  
|Interest expense                                                                  |   | (2,035                           | )
|Other income (expense) (Note 16)                                                  |   | (420                             | )
|Income tax expense                                                                |   | -                                |  
|Net loss                                                                          |   | (82,357                          | )
|                                                                                  |   |                                  |  
|Items that may be reclassifed in the future to profit
      and loss              |   |                                  |  
|Foreign currency translation adjustment                                           |   | 3,056                            |  
|Unrealized gain on available-for-sale assets                                      |   | (136                             | )
|Gains on available-for-sale financial assets reclassified
      to profit or loss |   | -                                |  
|Other
      comprehensive income (loss)                                           |   | 2,920                            |  
|Comprehensive loss                                                                | $ | (79,437                          | )
|                                                                                  |   |                                  |  
|Net loss attributable to:                                                         |   |                                  |  
|Owners of the Company                                                             | $ | (82,217                          | )
|Non-controlling interests
    (Note 4)                                            |   | (140                             | )
|                                                                                  | $ | (82,357                          | )
|Comprehensive loss attributable to:                                               |   |                                  |  
|Owners of the Company                                                             | $ | (79,297                          | )
|Non-controlling interests (Note 4)                                                |   | (140                             | )
|                                                                                  | $ | (79,437                          | )
|                                                                                  |   |                                  |  
|Basic and
      diluted loss per share (Note 13)                                  |   | ($2.46                           | )

See accompanying notes to the consolidated financial
statements

F-2

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Consolidated Balance Sheets                                           
|(Expressed in
      thousands of US dollars, except per share amounts)

|                                                                                                                                                                                                                                |   | December 31, 2015 |   |   | December 31, 2014 |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ----------------- | - | - | ----------------- | -
|ASSETS                                                                                                                                                                                                                          |   |                   |   |   |                   |  
|                                                                                                                                                                                                                                |   |                   |   |   |                   |  
|Current assets                                                                                                                                                                                                                  |   |                   |   |   |                   |  
|Cash and cash equivalents                                                                                                                                                                                                       | $ | 12,965            |   | $ | 10,411            |  
|Trade and other receivables (Note 5)                                                                                                                                                                                            |   | 2,617             |   |   | 600               |  
|Inventories (Note 6)                                                                                                                                                                                                            |   | 30,671            |   |   | 30,539            |  
|Prepaid expenses and other assets                                                                                                                                                                                               |   | 1,433             |   |   | 762               |  
|Mineral
      properties held for sale (Note 9)                                                                                                                                                                                 |   | 1,301             |   |   | 1,953             |  
|Total current assets                                                                                                                                                                                                            |   | 48,987            |   |   | 44,265            |  
|                                                                                                                                                                                                                                |   |                   |   |   |                   |  
|Notes receivable and other (Note 5)                                                                                                                                                                                             |   | 1,096             |   |   | 1,048             |  
|Long-term inventories (Note 6)                                                                                                                                                                                                  |   | -                 |   |   | 2,000             |  
|Plant and equipment (Note 8)                                                                                                                                                                                                    |   | 29,069            |   |   | 735               |  
|Mineral properties (Note 8)                                                                                                                                                                                                     |   | 91,031            |   |   | 60,512            |  
|Intangible assets (Note 7)                                                                                                                                                                                                      |   | 9,117             |   |   | 3,881             |  
|Restricted
      cash (Note 10)                                                                                                                                                                                                 |   | 12,980            |   |   | 16,148            |  
|Total assets                                                                                                                                                                                                                    | $ | 192,280           |   | $ | 128,589           |  
|                                                                                                                                                                                                                                |   |                   |   |   |                   |  
|LIABILITIES & EQUITY                                                                                                                                                                                                            |   |                   |   |   |                   |  
|                                                                                                                                                                                                                                |   |                   |   |   |                   |  
|Current liabilities                                                                                                                                                                                                             |   |                   |   |   |                   |  
|Accounts payable and accrued liabilities                                                                                                                                                                                        | $ | 9,536             |   | $ | 4,746             |  
|Deferred revenue (Note 16)                                                                                                                                                                                                      |   | -                 |   |   | 1,517             |  
|Current portion of asset retirement obligation (Note
      10)                                                                                                                                                                  |   | 1,000             |   |   | 121               |  
|Current portion of loans and borrowings (Note 11)                                                                                                                                                                               |   | 3,582             |   |   | 46                |  
|Total current liabilities                                                                                                                                                                                                       |   | 14,118            |   |   | 6,430             |  
|                                                                                                                                                                                                                                |   |                   |   |   |                   |  
|Deferred revenue (Note 16)                                                                                                                                                                                                      |   | 2,165             |   |   | -                 |  
|Asset retirement obligation (Note 10)                                                                                                                                                                                           |   | 7,573             |   |   | 5,562             |  
|Loans and
      borrowings (Note 11)                                                                                                                                                                                            |   | 28,937            |   |   | 15,786            |  
|Total liabilities                                                                                                                                                                                                               |   | 52,793            |   |   | 27,778            |  
|                                                                                                                                                                                                                                |   |                   |   |   |                   |  
|Equity                                                                                                                                                                                                                          |   |                   |   |   |                   |  
|Share capital (Note 12)     
      Common shares, without par value, unlimited shares
      authorized;      shares issued and
      outstanding 46,519,132 at December 31,
      2015      and 19,677,552 at December 31, 2014 |   | 373,934           |   |   | 260,117           |  
|Accumulated Deficit                                                                                                                                                                                                             |   | (242,108          | ) |   | (159,891          | )
|Accumulated
      other comprehensive income                                                                                                                                                                                    |   | 3,505             |   |   | 585               |  
|Total shareholders' equity                                                                                                                                                                                                      |   | 135,331           |   |   | 100,811           |  
|Non-controlling interests (Note 4)                                                                                                                                                                                              |   | 4,156             |   |   | -                 |  
|Total equity                                                                                                                                                                                                                    |   | 139,487           |   |   | 100,811           |  
|Total
      liabilities and equity                                                                                                                                                                                              | $ | 192,280           |   | $ | 128,589           |  
|                                                                                                                                                                                                                                |   |                   |   |   |                   |  
|Commitments and contingencies (Note 17)                                                                                                                                                                                         |   |                   |   |   |                   |  
|Subsequent events (Notes 9 and 21)                                                                                                                                                                                              |   |                   |   |   |                   |  

See accompanying notes to the consolidated financial
statements

F-3

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Consolidated Statements of Changes in Equity                          
|(Expressed in
      thousands of US dollars, except per share amounts)

|                                                                                                              |  |              |   |   |         |               |   |          | Accumulated 
    other |   |        |             |   |            | **Non-**  |   |           |   |  
|------------------------------------------------------------------------------------------------------------- |  | ------------ | - | - | ------- | ------------- | - | -------- | ---------------------- | - | ------ | ----------- | - | ---------- | --------- | - | --------- | - | -
|                                                                                                              |  | Common Stock |   |   |         | comprehensive |   |          | **Shareholders'**      |   |        | controlling |   |            | **Total** |  
|                                                                                                              |  | Shares       |   |   | Amount  |               |   | Deficit  |                        |   | income |             |   | **equity** |           |   | interests |   |  
|Balance at December 31,
      2012                                                                            |  | 13,642,672   |   | $ | 203,335 |               | $ | (36,666  | )                      | $ | (957   | )           | $ | 165,712    |           | $ | -         |   | $
|Net loss                                                                                                      |  | -            |   |   | -       |               |   | (36,590  | )                      |   | -      |             |   | (36,590    | )         |   | -         |   |  
|Other comprehensive income                                                                                    |  | -            |   |   | -       |               |   | -        |                        |   | 337    |             |   | 337        |           |   | -         |   |  
|Shares issued for investment in Virginia
      Energy Inc. (Note 12f)                                         |  | 442,433      |   |   | 3,947   |               |   | -        |                        |   | -      |             |   | 3,947      |           |   | -         |   |  
|Shares and warrants issued
      for cash by public and private offerings (Notes 12c and 12e)                 |  | 1,572,616    |   |   | 11,357  |               |   | -        |                        |   | -      |             |   | 11,357     |           |   | -         |   |  
|Shares issued for investor relations                                                                          |  | 21,000       |   |   | 167     |               |   | -        |                        |   | -      |             |   | 167        |           |   | -         |   |  
|Shares issued for property
      acquisitions                                                                 |  | 31,407       |   |   | 275     |               |   | -        |                        |   | -      |             |   | 275        |           |   | -         |   |  
|Shares issued for Strathmore Minerals
      Corporation asset purchase (Note 12d)                             |  | 3,891,159    |   |   | 38,634  |               |   | -        |                        |   | -      |             |   | 38,634     |           |   | -         |   |  
|Share-based compensation
      (Note 14)                                                                      |  | -            |   |   | 1,268   |               |   | -        |                        |   | -      |             |   | 1,268      |           |   | -         |   |  
|Options issed in connection with the
      acquisition of Strathmore Mineralls Corp. asset purchase (Note 14) |  | -            |   |   | 270     |               |   | -        |                        |   | -      |             |   | 270        |           |   | -         |   |  
|Share issuance costs                                                                                          |  | -            |   |   | (1,144  | )             |   | -        |                        |   | -      |             |   | (1,144     | )         |   | -         |   |  
|Adjustment due to rounding for share
      consolidation (Note 12)                                            |  | (36          | ) |   | -       |               |   | -        |                        |   | -      |             |   | -          |           |   | -         |   |  
|Balance at December 31,
      2013                                                                            |  | 19,601,251   |   |   | 258,109 |               |   | (73,256  | )                      |   | (620   | )           |   | 184,233    |           |   | -         |   |  
|Net loss                                                                                                      |  | -            |   |   | -       |               |   | (86,635  | )                      |   | -      |             |   | (86,635    | )         |   | -         |   |  
|Other comprehensive income                                                                                    |  | -            |   |   | -       |               |   | -        |                        |   | 1,205  |             |   | 1,205      |           |   | -         |   |  
|Shares issued for exercise of stock options
      (Note 14)                                                   |  | 15,000       |   |   | 120     |               |   | -        |                        |   | -      |             |   | 120        |           |   | -         |   |  
|Shares issued for exercise of
      share purchase warrants (Note 12)                                         |  | 61,301       |   |   | 483     |               |   | -        |                        |   | -      |             |   | 483        |           |   | -         |   |  
|Share-based compensation (Note 14)                                                                            |  | -            |   |   | 1,405   |               |   | -        |                        |   | -      |             |   | 1,405      |           |   | -         |   |  
|Balance at December 31,
      2014                                                                            |  | 19,677,552   |   |   | 260,117 |               |   | (159,891 | )                      |   | 585    |             |   | 100,811    |           |   | -         |   |  
|Net loss                                                                                                      |  | -            |   |   | -       |               |   | (82,217  | )                      |   | -      |             |   | (82,217    | )         |   | (140      | ) |  
|Other comprehensive income                                                                                    |  | -            |   |   | -       |               |   | -        |                        |   | 2,920  |             |   | 2,920      |           |   | -         |   |  
|Shares issued in connection with the
      acquisition of Uranerz Energy Corporation (Notes 4 and 12b)        |  | 25,347,209   |   |   | 105,673 |               |   | -        |                        |   | -      |             |   | 105,673    |           |   | -         |   |  
|Options issed in connection
      with the acquisition of Uranerz Energy Corporation (Note 4)                 |  | -            |   |   | 3,681   |               |   | -        |                        |   | -      |             |   | 3,681      |           |   | -         |   |  
|Shares issued for cash by at-the-market
      offering (Note 12a)                                             |  | 1,275,908    |   |   | 2,939   |               |   | -        |                        |   | -      |             |   | 2,939      |           |   | -         |   |  
|Share issued for property
      acquisitions                                                                  |  | 169,361      |   |   | 550     |               |   | -        |                        |   | -      |             |   | 550        |           |   | -         |   |  
|Shares issued for exercise of stock options
      (Note 14)                                                   |  | 48,802       |   |   | 185     |               |   | -        |                        |   | -      |             |   | 185        |           |   | -         |   |  
|Shares issued for exercise of
      share purchase warrants (Note 12)                                         |  | 300          |   |   | 2       |               |   | -        |                        |   | -      |             |   | 2          |           |   | -         |   |  
|Share issuance cost                                                                                           |  | -            |   |   | (312    | )             |   | -        |                        |   | -      |             |   | (312       | )         |   | -         |   |  
|Share-based compensation
      (Note 14)                                                                      |  | -            |   |   | 1,099   |               |   | -        |                        |   | -      |             |   | 1,099      |           |   | -         |   |  
|Non-controlling interest upon acquisition of
      Uranerz Energy Corporation (Note 4)                        |  | -            |   |   | -       |               |   | -        |                        |   | -      |             |   | -          |           |   | 3,992     |   |  
|Contributions attributable to
      non-controlling interest                                                  |  | -            |   |   | -       |               |   | -        |                        |   | -      |             |   | -          |           |   | 304       |   |  
|Balance at December 31, 2015                                                                                  |  | 46,519,132   |   | $ | 373,934 |               | $ | (242,108 | )                      | $ | 3,505  |             | $ | 135,331    |           | $ | 4,156     |   | $

See accompanying notes to the consolidated financial
statements

F-4

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Consolidated Statements of Cash Flows                                 
|(Expressed in
      thousands of US dollars, except per share amounts)

|                                                                                                    |   | For the years ended December 31, |  
|--------------------------------------------------------------------------------------------------- | - | -------------------------------- | -
|                                                                                                    |   | 2015                             |  
|                                                                                                    |   |                                  |  
|OPERATING ACTIVITIES                                                                                |   |                                  |  
|Net loss for the period                                                                             | $ | (82,357                          | )
|Items not involving cash:                                                                           |   |                                  |  
|Depletion, depreciation
      and amortization                                                      |   | 7,787                            |  
|Stock-based compensation (Note 14)                                                                  |   | 1,099                            |  
|Change in value of
      convertible debentures (Note 11)                                           |   | 1,548                            |  
|Accretion of asset retirement
      obligation (Note 10)                                            |   | 494                              |  
|Unrealized foreign
      gains (losses)                                                             |   | 483                              |  
|Non-cash standby cost accrued                                                                       |   | 876                              |  
|Non-cash costs directly
      attributable to acquisitions (Note 4)                                 |   | 3,928                            |  
|Equity-settled share-based payment
      expenses                                                   |   | -                                |  
|Impairment of property,
      plant and equipment and mineral properties (Note 9)                   |   | 10,994                           |  
|Impairment of goodwill (Note 9)                                                                     |   | 47,730                           |  
|Impairment of
      inventories                                                                     |   | -                                |  
|Miscellaneous non- cash income
      (expenses)                                                     |   | (500                             | )
|Change in value of
      investments (Note 16)                                                      |   | (38                              | )
|Changes in assets and liabilities net of effects of
      purchased companies                       |   |                                  |  
|(Increase) decrease in
      inventories                                                            |   | 5,752                            |  
|(Increase) decrease in trade and other
      receivables                                            |   | (2,017                           | )
|(Increase) decrease in
      prepaid expenses and other assets                                      |   | (404                             | )
|Increase (decrease) in accounts payable
      and accrued liabilities                               |   | 2,519                            |  
|Changes in deferred revenue
      (Note 16)                                                         |   | 648                              |  
|Cash paid

      for reclamation and remediation activities (Note 10)                               |   | (626                             | )
|                                                                                                    |   | (2,084                           | )
|INVESTING ACTIVITIES                                                                                |   |                                  |  
|Purchase of mineral properties and
      property, plant and equipment                              |   | (4,297                           | )
|Cash acquired in the acquisition of Uranerz Energy
      Corporation (Note 4)                       |   | 2,459                            |  
|Receipt of restricted cash related to
      restructuring bonding program (Note 10)                 |   | 5,268                            |  
|Sale of mineral properties                                                                          |   | -                                |  
|Sale of plant and equipment                                                                         |   | -                                |  
|Sale of marketable securities                                                                       |   | -                                |  
|Acquisition of Strathmore Minerals Corporation, net
      of cash acquired (Note 12)                |   | -                                |  
|                                                                                                    |   | 3,430                            |  
|FINANCING ACTIVITIES                                                                                |   |                                  |  
|Issuance of common shares for cash                                                                  |   | 2,627                            |  
|Option and warrant exercises (Note 12
      and 14)                                                 |   | 187                              |  
|Repayment of loans and borrowings                                                                   |   | (1,730                           | )
|Cash received from non-controlling interest                                                         |   | 304                              |  
|                                                                                                    |   | 1,388                            |  
|                                                                                                    |   |                                  |  
|INCREASE IN CASH AND CASH EQUIVALENTS DURING THE
      PERIOD                                       |   | 2,734                            |  
|Effect of exchange rate fluctuations
      on cash held in foreign currencies                       |   | (180                             | )
|Cash and
      cash equivalents - beginning of period                                               |   | 10,411                           |  
|CASH AND CASH EQUIVALENTS - END OF PERIOD                                                           | $ | 12,965                           |  
|                                                                                                    |   |                                  |  
|Non-cash investing and financing
      transactions:                                                |   |                                  |  
|Issuance of secured notes for acquisition of mineral
      properties                               | $ | 446                              |  
|Issuance of common shares for
      acquisition of mineral properties                               |   | 550                              |  
|Issuance of common shares, options and warrants for
      acquisition of Uranerz Energy Corporation |   | 109,354                          |  
|Issuance of shares for investment in
      Virginia Energy                                          |   | -                                |  
|Issuance of shares and warrants for acquisition of
      Strathmore Minerals Corp                   |   | -                                |  
|Issuance of secured notes for
      acquisition of mineral properties                               |   | -                                |  

See accompanying notes to the consolidated financial
statements

F-5

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

1. THE COMPANY AND DESCRIPTION OF BUSINESS

Energy Fuels Inc. was incorporated under the laws of the
Province of Alberta and was continued under the Business Corporations Act
(Ontario).

Energy Fuels Inc. and its subsidiary companies (collectively
the Company or EFI) are engaged in uranium extraction, recovery and sales of
uranium from mineral properties and the recycling of uranium bearing materials
generated by third parties. As a part of these activities the Company also
acquires, explores, evaluates and, if warranted, permits uranium properties. The
Companys final uranium product, uranium oxide concentrates
(U3O8 or uranium concentrates), is sold to customers
for further processing into fuel for nuclear reactors.

The Company is an exploration stage mining company as defined
by the United States (US) Securities and Exchange Commission (SEC) Industry
Guide 7 (the SEC Industry Guide 7) as it has not established the existence of
proven or probable reserves on any of our properties.

The Company has two operating segments, the conventional
uranium recovery segment (the Conventional Uranium Segment) and the in-situ
uranium recovery segment (ISR Uranium Segment).

The Conventional Uranium Segment

The Conventional Uranium Segment consists of a standalone
conventional uranium recovery facility (the White Mesa Mill), conventional
mining projects in the vicinity of the White Mesa Mill located in the Colorado
Plateau, Henry Mountains, Arizona Strip, and the Roca Honda joint venture (Roca
Honda) in New Mexico, and the Sheep Mountain Project in Wyoming. At December
31, 2015 the conventional mining projects in the vicinity of the White Mesa Mill
are on standby, being evaluated for continued mining activities and/or in
process of being permitted. The White Mesa Mill also processes third party
uranium bearing mineralized materials from mining and recycling activities.

The ISR Uranium Segment

The ISR Uranium Segment consists of a uranium recovery facility
to recover from operating wellfields of the Nichols Ranch Project located in
Wyoming. The Nichols Ranch Project also includes the Jane Dough property and the
Hank Project. Additionally, the segment includes other mineral properties in the
vicinity on the Nichols Ranch Project. These assets were acquired as part of the
Companys 2015 acquisition of Uranerz Energy Corporation (Uranerz) (See Note
4).

2. BASIS OF PRESENTATION

The consolidated financial statements have been prepared in
accordance with accounting principles generally accepted in the United States
(US GAAP) and are presented in thousands of US dollars (USD) except per
share amounts. Certain footnote disclosures have share prices which are
presented in Canadian dollars (Cdn$).

Conversion from IFRS to US GAAP

In 2013 the Company listed its shares on the NYSE MKT, and
accordingly registered its securities under the Securities Exchange Act of 1934,
as amended (the Exchange Act). This registration subjected the Company to
ongoing reporting requirements under the Exchange Act. Under the
multi-jurisdictional disclosure system, Canadian issuers that meet the
definition of foreign private issuer under the rules of the SEC are permitted
to use Canadian disclosure documents to largely satisfy their reporting
requirements with the SEC. The Company satisfied the requirements for foreign
private issuer status until June 30, 2015, at which time the acquisition of
Uranerz Energy Corporation (Note 4) caused the Company to have more than 50% of
its outstanding voting securities of record held either directly or indirectly
by residents of the United States.

Since the Company no longer qualifies as a foreign private
issuer, effective January 1, 2016, the Company as a US domestic issuer is
required to file an annual report on Form 10-K covering Fiscal 2015. The Company
is also, as of January 1, 2016, required to file ongoing periodic reports under
the Exchange Act.

Prior to January 1, 2016, the Company prepared its consolidated
financial statements in accordance with International Financial Reporting
Standards (IFRS) as issued by the International Accounting Standards Board
(IASB). U.S. domestic issuers are required to prepare their financial
statements that are included in SEC filings in accordance with US GAAP.
Accordingly, the Company converted its financial statements from IFRS to US GAAP
for all periods presented.

F-6

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The Company's consolidated financial statements have been
prepared in accordance with US GAAP. The preparation of the Company's
consolidated financial statements requires the Company to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
related disclosure of contingent assets and liabilities at the date of the
consolidated financial statements and the reported amounts of expenses during
the reporting period. The more significant areas requiring the use of management
estimates and assumptions relate to expectations of the future price of uranium
and estimates of recoverable mineral resources that are the basis for future
cash flow estimates utilized in assessing fair value for business combinations
and impairment calculations; the determination of whether an acquisition
represents a business combination or an asset acquisition; the use of management
estimates and assumptions related to environmental, reclamation and closure
obligations; the fair value and accounting treatment of financial instruments
including marketable securities and derivative instruments; determination of
significant influence; and estimates with respect to assumptions regarding
stock-based compensation expense. The Company bases its estimates on historical
experience, market studies, reports by qualified persons and on various other
assumptions that are believed to be reasonable under the circumstances. Actual
results may differ significantly from these estimates.

Basis of consolidation

These consolidated financial statements include the accounts of
the Company together with its subsidiaries controlled by the Company. The
Company also proportionally consolidates its 60% interest in the accounts of its
unincorporated Roca Honda joint venture. Intercompany transactions, balances and
unrealized gains on transactions between the Company and its subsidiaries are
eliminated. The functional currency for the majority of the Companys operations
is the USD.

Extracting and Recovery Activities while in the
Exploration stage

The Company extracts and/or recovers mineralized uranium from
mining activities and alternate feed materials resulting in saleable uranium
concentrates from its White Mesa Mill and its Nichols Ranch Project. While the
Company has established the existence of mineral resources and extracts and
processes saleable uranium from these operations, the Company has not
established proven or probable reserves, as defined under SEC Industry Guide 7,
for these operations or any of its uranium projects. As a result, the Company is
in the Exploration stage as defined under SEC Industry Guide 7. Furthermore, the
Company has no current plans to establish proven or probable reserves for any of
its uranium projects.

While in the Exploration stage, the Company expenses most
amounts that would normally be capitalized and subsequently depreciated or
depleted over the life of the mining operation on properties that have proven or
probable reserves. Items such as the construction of wellfields and related
header houses, additions to recovery facilities and advancement of properties
are expensed in the period incurred. As a result, the Companys consolidated
financial statements may not be directly comparable to the financial statements
of mining companies in the development or production stages.

The White Mesa Mill, and certain conventional mining projects
in the vicinity of the mill, and the Nichols Ranch Project (collectively the
Extracting and Recovery Operations) were acquired in two unrelated business
combinations. These Extracting and Recovery Operations were recorded at fair
value on the date of the respective acquisition and included estimated values
which included valuing these assets utilizing the Companys estimate of future
market prices of uranium and expected recoveries of uranium. The values
determined included estimated cash flows associated with value beyond proven and
probable reserves to develop, extract and recover the estimated saleable uranium
concentrates from these operations.

The fair value of the Extracting and Recovery Operations
recorded on the acquisition date is depreciated on a straight line basis over
the estimated useful life of the components of the operation since the
Extracting and Recovery Operations do not have proven or probable reserves.
Accordingly, all expenditures incurred subsequent to the acquisition dates
relating to the preparation of properties for mineral extraction, expansion of
or additions to the Extracting and Recovery Operations are expensed as incurred.
This includes expenditures relating to activities such as the preparing
properties for mineral extraction, construction of mine wellfields, header
houses and disposal wells and additions to the recovery facilities are expensed
as incurred as no proven or probable reserves have been established for these
uranium projects.

F-7

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Business combinations

A business combination is defined as an acquisition of assets
and liabilities that constitute a business. A business consists of inputs,
including non-current assets, and processes, including operational processes,
that when applied to those inputs, have the ability to create outputs that
provide a return to the Company and its shareholders. A business also includes
those assets and liabilities that do not necessarily have all the inputs and
processes required to produce outputs, but can be integrated with the inputs and
processes of the Company to create outputs.

Business acquisitions are accounted for using the acquisition
method whereby acquired assets and liabilities are recorded at fair value as of
the date of acquisition with any excess of the purchase consideration over such
fair value being recorded as goodwill. If the fair value of the net assets
acquired exceeds the purchase consideration, the difference is recognized
immediately as a gain in the consolidated statement of operations.

Mining assets, which include mineral properties and rights,
operating mines and recovery facilities, are recorded at fair value and includes
estimated values of the mining assets beyond proven and probable reserves as
well as the Companys estimate of future market prices of uranium. The estimated
cash flow used to value the mining assets for operating properties and recovery
facilities include the estimated cash outflows required to develop, extract and
recover the value beyond proven and probable reserves.

Non-controlling interest in an acquisition may be measured at
either fair value or at the non-controlling interests proportionate share of
the fair value of the acquirees net identifiable assets. The acquisition date
is the date the Company acquires control over the acquiree. The Company
considers all relevant facts and circumstances in determining the acquisition
date.

Acquisition related costs, other than costs to issue debt or
equity securities of the acquirer, including investment banking fees, legal
fees, accounting fees, change in control payments, valuation fees and other
professional or consulting fees are expensed as incurred.

Impairment of Assets

The Company reviews and evaluates its long-lived assets for
impairment when events or changes in circumstances indicate that the related
carrying amounts may not be recoverable. Mineral properties are monitored for
impairment based on factors such as mineral prices, government regulation and
taxation, the Company's continued right to explore the area, exploration
reports, assays, technical reports, drill results and its continued plans to
fund exploration programs on the property.

At each reporting date, the Company reviews its non-operating
mining assets to determine whether there is any indication of impairment. If any
such indication exists, the asset is tested for impairment. Impairment losses
are recognized in profit or loss.

For operating mines, recoverability is measured by comparing
the undiscounted future net cash flows to the net book value. When the net book
value exceeds future net undiscounted cash flows, an impairment loss is measured
and recorded based on the excess of the net book value over fair value. Fair
value for operating mines is determined using a combined approach, which uses a
discounted cash flow model for the existing operations and non-operating
properties with available cash flow models and a market approach for the fair
value assessment of non-operating and exploration properties where no cash flow
model is available. Future cash flows are estimated based on quantities of
recoverable mineralized material, expected uranium prices (considering current
and historical prices, trends and estimates), production levels, operating
costs, capital requirements and reclamation costs, all based on life-of-mine
plans. In estimating future cash flows, assets are grouped at the lowest level
for which there are identifiable cash flows that are largely independent of
future cash flows from other asset groups. The Company's estimates of future
cash flows are based on numerous assumptions and it is possible that actual
future cash flows will be significantly different than the estimates, as actual
future quantities of recoverable minerals, uranium prices, production levels,
costs and capital are each subject to significant risks and uncertainties.

Cash and Cash Equivalents

Cash and cash equivalents consist of all cash balances and
highly liquid investments with an original maturity of three months or less.
Because of the short maturity of these investments, the carrying amounts
approximate their fair value. Restricted cash is excluded from cash and cash
equivalents and is included in other current or long-term assets.

F-8

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Investments

The Company accounts for investments over which the Company
exerts significant influence, but not control, over the financial and operating
policies through the fair value option of ASC Topic 825  Financial
Instruments. The cost of such investments is measured at the fair value of
the assets given up, shares issued or liabilities assumed at the date of
acquisition plus costs directly attributable to the acquisition. Subsequent to
initial recognition, they are measured at fair value and changes therein, are
recognized in earnings.

Unrealized gains and losses on transactions between the Company
and its associates are eliminated to the extent of the Companys interest in its
associates.

Inventories

Expenditures related to the extraction and recovery of uranium
concentrates and depreciation of the acquisition cost of the Extracting and
Recovery Operations are inventoried as stockpiles and in-process and concentrate
inventories.

Stockpiles are comprised of uranium bearing materials that have
been extracted from properties and are available for further processing.
Extraction costs are added to the stockpile as incurred and removed from the
stockpile based upon the average cost per ton of material extracted. The current
portion of material in stockpiles represents the amount expected to be processed
in the next twelve months. Stockpiles are valued at the lower of cost or market
(LCM) where market shall not be less than net realizable value reduced by an
allowance for an approximately normal profit margin.

In-process and concentrate inventories include the cost of the
material processed from the stockpile as well as production costs incurred to
extract uranium bearing fluids from the wellfields and all costs to recover the
uranium into concentrates or process through the White Mesa Mill. Finished
uranium concentrate inventories also include costs of any finished product
purchased from the market. Recovery costs typically include labor, chemical
reagents and directly attributable mill and plant overhead expenditures. Work
in-process and uranium concentrates are carried at the lower of average costs or
net realizable value.

Materials and other supplies held for use in the recovery of
uranium concentrates are carried at the lower of average cost and net realizable
value and are added to the costs of inventories when consumed in the uranium
extraction process.

Plant and equipment

a.Recognition
and measurement

Plant and equipment are measured at cost less accumulated
depreciation and any accumulated impairment losses. Cost includes expenditures
that are directly attributable to the acquisition of the asset. Subsequent costs
are included in the assets carrying amount or recognized as a separate asset,
as appropriate, only when it is probable that future economic benefits
associated with the item will flow to the Company and the cost can be measured
reliably. The carrying amount of a replaced asset is derecognized when it is
replaced, and the cost of the replacement asset is capitalized.

**b. *Depreciation
and amortization*

Depreciation and amortization are calculated on a straight line
basis to their estimated residual value over an estimated useful life which
ranges from three to fifteen years depending upon the asset type. When assets
are retired or sold, the resulting gains or losses are reflected in current
earnings as a component of other income or expense. Residual values, method of
depreciation and useful lives of the assets are reviewed at least annually and
adjusted if appropriate.

Where straight-line depreciation is utilized, the range of
useful lives for various asset classes is generally as follows:

| |  | Buildings                       | 15 years 
| | - | ------------------------------- | ---------
| |  | Shop tools and equipment        | 3-5 years
| |  | Mining equipment                | 5 years  
| |  | Office equipment                | 4-5 years
| |  | Furniture and fixtures          | 5-7 years
| |  | Light trucks & utility vehicles | 5 years  

The amortization method, residual values, and useful lives of
plant and equipment are reviewed annually and any change in estimate is applied
prospectively.

F-9

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

**c. **Nichols
Ranch Plant and Equipment

The Nichols Ranch plant and equipment is measured at cost less accumulated
depreciation and any accumulated impairment losses. Since the Company has not
completed feasibility or other studies sufficient to characterize the
mineralized uranium at any properties acquired as part of the Uranerz
transaction (Note 4) as
proven or probable reserves as defined and set forth in SEC Industry Guide 7,
the amortization of the plant and equipment charged to
expense based on the straight-line method over the estimated life  of 12 years.

Intangible assets

Sales contracts acquired in a business combination are
recognized initially at fair value at the acquisition date. The Companys
intangible assets are recorded at cost less accumulated amortization.

Amortization is recorded as the Company sells inventory under
its long-term sales contracts based on units sold, and is recognized in the
statement of operations.

Non-operating Assets

Non-operating Assets consist of mineral properties and rights
along with data and analyses related to the properties which are in various
stages of evaluation and permitting. Costs to acquire the non-operating assets
are capitalized at cost or fair value if such assets were a part of a business
combination.

Mining activities for non-operating assets involve the search
for minerals, the determination of technical feasibility and the assessment of
commercial viability of an identified resource. Expenditures incurred in
relation to such mining activities include costs which are directly attributable
to researching and analyzing existing exploration data; conducting geological
studies, exploratory drilling and sampling; examining and testing extraction and
treatment methods; and completing pre-feasibility and feasibility studies. Such
expenditures are expensed as incurred.

Mineral properties, that are not held by production, and any
related surface access to the minerals generally require periodic payments
and/or certain expenditures related to the property in order for the Company to
retain its interest in the mineral property (collectively, Holding Costs). The
Company expenses all Holding Costs in the period they are incurred.

Stand-by Properties

Stand-by properties are mineral properties that have extracted
mineral resources in the past but are currently non-operating. Expenditures
related to these properties are primarily related to maintaining the assets and
permits in a condition that will allow re-start of the operations given
appropriate commodity prices. All costs related to stand-by assets are expensed
as incurred.

The White Mesa Mill operates on a campaign basis. When the mill
is not recovering material, all costs related to the mill are expensed as
incurred.

Asset retirement obligations

The Companys asset retirement obligation (ARO) relates to
expected mine, wellfield, plant and mill reclamation and closure activities, as
well as costs associated with reclamation of exploration drilling. The Companys
activities are subject to numerous governmental laws and regulations. Estimates
of future reclamation liabilities for ARO are recognized in the period when such
liabilities are incurred. These estimates are updated on a periodic basis and
are subject to changing laws, regulatory requirements, changing technology and
other factors which will be recognized when appropriate. Liabilities related to
site restoration include long-term treatment and monitoring costs and
incorporate total expected costs net of recoveries. Expenditures incurred to
dismantle facilities, restore and monitor closed resource properties are charged
against the related AROs.

As the Company has no proven or probable reserves, such costs,
discounted to their present value, are expensed as soon as the obligation to
incur such costs arises. The fair value of AROs is measured by discounting the
expected cash flows using a discount factor that reflects the credit-adjusted
risk free rate of interest, while taking into account an inflation rate. The decommissioning liability is accreted to full value
over time through periodic accretion charges recorded to operations as accretion
expense. The Company adjusts the carrying amounts of the ARO for changes in
estimates of the amount or timing of underlying future cash flows. As the
Company has no proven and probable reserves as set forth in SEC Industry Guide 7
any adjustments to the carrying amounts are expensed as incurred.

F-10

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Loans and borrowings

Loans and borrowings are non-derivative financial assets with
fixed or determinable payments that are not quoted in an active market. Loans
and receivables are initially recognized at the amount expected to be received,
less a discount (when material) to reduce the loans and receivables to fair
value. Subsequently, loans and receivables are measured at amortized cost using
the effective interest method less a provision for impairment.

Convertible debentures are recognized at fair value through the
fair value option.

Revenue

a.Sale of goods

Revenue from the sale of mineral concentrates is recognized
when it is probable that the economic benefits will flow to the Company and
delivery has occurred, title has transferred, the sales price and costs incurred with respect to the
transaction can be measured reliably and collectability is reasonably assured.
For uranium concentrates, revenue is typically recognized when delivery is
evidenced by book transfer at the applicable uranium storage facility. For
vanadium related products, revenue is recognized at the time of shipment, which
is when title is transferred to the customer.

b.Rendering of services

Revenue from toll milling services is recognized as material is
processed in accordance with the specifics of the applicable toll milling
agreement. Revenue and unbilled accounts receivable are recorded as related
costs are incurred using billing formulas included in the applicable toll
milling agreement.

Revenue from alternate feed process milling is recognized as
material is processed, in accordance with the specifics of the applicable
processing agreement. Deferred revenues represent proceeds received on delivery
of alternate feed materials but in advance of the required processing activity.

Interest income and expense

Interest income and expense are recognized as they accrue in
profit or loss, using the effective interest method.

Share-Based Compensation

The Company records share based compensation awards exchanged
for employee services at fair value on the date of the grant and expenses the
awards in the consolidated statement of operations over the requisite employee
service period in capital stock. The fair value of stock options is determined
using the Black-Scholes valuation model. The fair value of restricted stock
units (RSUs) is based on the Energy Fuels stock price on the date of grant.
Stock based compensation expense related to awards with only service conditions
has a graded vesting schedule which are recorded on a straight-line basis over
the requisite service period for each separately vesting portion of the award as
if the award was, in substance, multiple awards, while all other awards are
recognized on a straight-line basis. The Company's estimates may be impacted by
certain variables including, but not limited to, stock price volatility,
employee stock option exercise behaviors, additional stock option grants,
estimates of forfeitures, the Company's performance, and related tax impacts.

Capital stock

Common shares are classified as equity. Incremental costs
directly attributable to the issue of common shares and share options are
recognized as a deduction from equity, net of any tax effects.

Treasury shares

When shares recognized as equity are repurchased, the amount of
the consideration paid, which includes directly attributable costs, net of any
tax effects, is recognized as a deduction from equity. Repurchased shares are
classified as treasury shares and are presented as a reduction in common shares.
When treasury shares are sold or reissued subsequently, the amount received is
recognized as an increase in equity and the resulting surplus or deficit on the
transaction is presented within capital stock.

F-11

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Foreign currency

Transactions in foreign currencies are translated to the
respective functional currencies of the Companys subsidiaries and joint
ventures at exchange rates at the dates of the transactions. Monetary assets and
liabilities denominated in foreign currencies are translated to the functional
currency at the exchange rate as of the reporting date. Non-monetary assets and
liabilities that are measured at fair value in a foreign currency are translated
to the functional currency at the exchange rate when the fair value was
determined. Foreign currency differences are generally recognized in profit or
loss. Non-monetary items that are measured based on historical cost in a foreign
currency are not translated.

The assets and liabilities of entities whose functional
currency is not the U.S. dollar are translated into the U.S. dollar at the
exchange rate as of the reporting date. The income and expenses of such entities
are translated into the U.S. dollar using average exchange rates for the
reporting period. Exchange differences on foreign currency translations are
recorded in other comprehensive income (loss). EFI and certain Canadian holding
companies have a Cdn$ functional currency. The Companys US operations have a
U.S. dollar functional currency.

Income taxes

The Company uses the asset and liability method of accounting
for income taxes. Under this method, deferred income tax assets and liabilities
are recorded based on differences between the financial statement carrying
values of existing assets and liabilities and their respective income tax bases
(temporary differences), and losses carried forward. Deferred income tax assets
and liabilities are measured using the enacted tax rates which will be in effect
when the temporary differences are likely to reverse. The effect on deferred
income tax assets and liabilities of a change in tax rates is included in
operations in the period in which the change is enacted.

The Company records a valuation allowance to reduce deferred
income tax assets to the amount that is believed more likely than not to be
realized. When the Company concludes that all or part of the deferred income tax
assets are not realizable in the future, the Company makes an adjustment to the
valuation allowance that is charged to earnings in the period such determination
is made.

Net income (loss) per share

The Company presents basic and diluted earnings (loss) per
share data for its common shares, calculated by dividing the earnings or loss
attributable to common shareholders of the Company by the weighted average
number of common shares outstanding during the period. Diluted earnings (loss)
per share is determined by adjusting the earnings or loss attributable to common
shareholders and the weighted average number of common shares outstanding for
the effects of all potential dilutive instruments.

Comprehensive income (loss)

In addition to Net income (loss), Comprehensive income
(loss) includes all changes in equity during a period, such as foreign
currency translation adjustments and cumulative unrecognized changes in fair
value of marketable securities, available-for-sale or other investments.

Fair value of financial instruments

Fair value accounting utilizes a fair value hierarchy that
prioritizes the inputs to valuation techniques used to measure fair value. The
hierarchy gives the highest priority to unadjusted quoted prices in active
markets for identical assets and liabilities (Level 1 measurements) and the
lowest priority to unobservable inputs (Level 3 measurements). The three levels
of the fair value hierarchy are described below:

Level 1 - Unadjusted quoted prices in
active markets that are accessible at the measurement date for identical,
unrestricted assets or liabilities

Level 2 - Quoted prices in markets that
are not active, or inputs that are observable, either directly or indirectly,
for substantially the full term of the asset or liability; and

Level 3 - Prices or valuation
techniques that require inputs that are both significant to the fair value
measurement and unobservable (supported by little or no market activity).

F-12

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Recently Issued Accounting Pronouncements

The FASB issued the following new and revised standards and
amendments, which are not yet effective which may have future applicability to
the Company:

Business combinations

In September 2015, the Financial Accounting Standards Board
(FASB) issued Accounting Standards Update (ASU) guidance related to
accounting for measurement-period adjustments in a business combination. This
update simplifies the measurement-period adjustments by requiring that an
acquirer recognize adjustments to provisional amounts that are identified during
the measurement period in the reporting period in which the adjustment amounts
are determined, and not retrospectively. This update also requires the separate
presentation on the face of the statement of income, or disclosure in the notes
to the financial statements, the portion of the amount recorded in
current-period earnings by line item that would have been recorded in previous
reporting periods if the adjustment to the provisional amounts had been
recognized as of the acquisition date. The Company is currently evaluating this
guidance and the impact it will have on the financial statements.

Inventory

In July 2015, ASU 2015-11 was issued related to inventory
which simplifies the subsequent measurement of inventories by replacing the lower of
cost or market test with a lower of cost and net realizable value test. The
update is effective in fiscal years, including interim periods, beginning after
December 15, 2016, and early adoption is permitted. The Company is currently
evaluating this guidance and the impact it will have on the Company's financial
statements.

Leases

In February 2016, the FASB issued ASU 2016-02 which core
principle is that a lessee should recognize the assets and the liabilities that
arise from leases, including operating leases. Under the new requirements, a
lessee will recognize in the statement of financial position a liability to make
lease payments (the lease liability) and the right-of-use asset representing the
right to the underlying asset for the lease term. For leases with a term of
twelve months or less, the lessee is permitted to make an accounting policy
election by class of underlying asset not to recognize lease assets and lease
liabilities. The recognition, measurement, and presentation of expenses and cash
flows arising from a lease by a lessee have not significantly changed from the
previous GAAP. The standard is effective for fiscal years beginning after
December 15, 2018, including interim periods within such fiscal year, with early
adoption permitted. The ASU requires a modified retrospective transition method
with the option to elect a package of practical expedients. The Company is
evaluating the effect of this amendment and the impact it will have on the
Companys financial statements.

Employee benefit plan accounting

In July 2015, ASU 2015-12 was issued related to defined benefit
pension plans, defined contribution pension plans, and health and welfare
benefit plans. This update designates contract value as the only required
measure for fully benefit-responsive investment contracts, simplifies and makes
more effective the investment disclosure requirements for employee benefit
plans, and provides a simplified method for determining the measurement date for
employee benefit plans. The update is effective in fiscal years, including
interim periods, beginning after December 15, 2015, and early adoption is
permitted. The Company is currently evaluating this guidance and the impact it
will have on the Company's financial statements.

Debt issuance costs

In April 2015, and further amended in August 2015, ASU 2015-03
was issued related to debt issuance costs. This update simplifies the
presentation of debt issuance costs by requiring debt issuance costs to be
presented as a deduction from the corresponding debt liability. The update is
effective in fiscal years, including interim periods, beginning after December
15, 2015. The Company is currently evaluating this guidance and the impact to
Loans and borrowingson the Company's financial statements.

Consolidations

In February 2015, ASU 2015-02 was issued related to
consolidations. This update makes some targeted changes to current consolidation
guidance and impacts both the voting and the variable interest consolidation
models. In particular, the update will change how companies determine whether
limited partnerships or similar entities are variable interest entities. The update is effective in fiscal years, including
interim periods, beginning after December 15, 2015, and early adoption is
permitted. The Company is currently evaluating this guidance and the impact on
the Company's financial statements.

F-13

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Revenue recognition

In May 2014, ASU 2015-14 was issued related to revenue from
contracts with customers. The new standard provides a five-step approach to be
applied to all contracts with customers and also requires expanded disclosures
about revenue recognition. In August 2015, the effective date was deferred to
reporting periods, including interim periods, beginning after December 15, 2017,
and will be applied retrospectively. Early adoption is not permitted. The
Company is currently evaluating this guidance and the impact it will have on the
Companys financial statements.

Deferred Income Taxes

In November 2015, the ASU 2015-17 related to the presentation
of deferred income taxes in the statement of financial position by requiring
that deferred tax liabilities and assets be classified as noncurrent. The update
is effective in fiscal years, including interim periods beginning on or after
December 15, 2016. The Company does not expect the updated guidance to have an
impact  on the Company's financial statements.

Going Concern

In August 2014, ASC 205-40guidance was amended to
provide guidance about managements responsibility to evaluate whether there is
substantial doubt about an entitys ability to continue as a going concern and
to provide related footnote disclosures.The amendments require
management to assess an entitys ability to continue as a going concern by
incorporating and expanding upon certain principles that are currently in US
auditing standards. Specifically, the amendments (1) provide a definition of the
term substantial doubt, (2) require an evaluation every reporting period
including interim periods, (3) provide principles for considering the mitigating
effect of managements plans, (4) require certain disclosures when substantial
doubt is alleviated as a result of consideration of managements plans, (5)
require an express statement and other disclosures when substantial doubt is not
alleviated, and (6) require an assessment for a period of one year after the
date that the financial statements are issued (or available to be issued). The
amendments in this update shall be effective for annual periods ending after
December 15, 2016, and interim periods within annual periods beginning after
December 15, 2016, with early application permitted. The Company is currently
evaluating this guidance and the impact on the Company's financial statements.

4. ACQUISITION OF URANERZ ENERGY CORPORATION

On June 18, 2015, the Company acquired of 100% of the
outstanding shares of Uranerz Energy Corporation. Under the terms of the
acquisition agreement, shareholders of Uranerz received 0.255 common shares of
the Company for each share of Uranerz common stock held. Each outstanding
Uranerz option or warrant was converted into an option or warrant (as
applicable) to acquire common shares of the Company, on the same terms and
conditions as were applicable to the stock option or warrant (as applicable)
prior to the acquisition, except that the number of shares subject to the option
or warrant and the exercise price of the option or warrant were adjusted based
on the exchange ratio of 0.255, so as to preserve the economic value of such
options or warrants.

Uranerz, now a wholly owned subsidiary of the Company, is a
United States based uranium company focused on in-situ uranium recovery. ISR is
a uranium extraction process that uses a leaching solution to extract uranium
from underground sandstone-hosted uranium resources and then recover the uranium
in the form of uranium concentrates. Uranerz controls a land position in the
central Powder River Basin in Wyoming, where it operates the Nichols Ranch
Project. The acquisition of Uranerz provides the Company with current ISR
capabilities and the capability to expand ISR extraction and recovery in the
future.

The acquisition was accounted for using the acquisition method
in accordance with ASC Topic 805, Business Combinations, with the Company being
identified as the acquirer. The measurement of the purchase consideration was
based on the market price of the Company's common stock on June 18, 2015 which
was $4.16 per share. The total purchase price, including the fair value of the
options and warrants, amounted to $106.34 million. The total transaction costs
incurred through December 31, 2015 by the Company was $6.89 million which was
recorded in Costs directly attributable to acquisitions and are comprised
of cash costs of $2.96 million and the issuance of 889,436 common shares of the
Company for a total share value of $3.93 million for advisory fees and to settle
a portion of required change in control payments to certain employees of
Uranerz.

During the fourth quarter of 2015, the Company finalized the
allocation of the purchase price, which resulted in an increase to plant and
equipment of $6.81 million and decreases in ARO of $0.18 and Goodwill of $6.99
million, respectively.

F-14

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

The allocation of the purchase price, based on the fair value
of assets acquired and liabilities assumed on June 18, 2015, is summarized in
the following table:

|Purchaseprice                                                                                |   |         |  
|-------------------------------------------------------------------------------------------- | - | ------- | -
|Issuance of 24,457,773
      common shares for replacement of Uranerz common shares          | $ | 101,744 |  
|Issuance
      of 2,690,250 warrants for replacement of Uranerz warrants (Note 12)           |   | 915     |  
|Issuance of 2,040,408 options for replacement of
      Uranerz share based options (Note 12) |   | 3,681   |  
|                                                                                             | $ | 106,340 |  
|Uranerzpurchasepriceallocation                                                               |   |         |  
|Cash and
      cash equivalents                                                              | $ | 2,459   |  
|Inventories                                                                                  |   | 3,742   |  
|Prepaid
      expenses and other assets                                                      |   | 402     |  
|Plant and equipment                                                                          |   | 29,974  |  
|Mineral
      properties                                                                     |   | 36,563  |  
|Intangible
      assets - customer contracts                                                 |   | 10,600  |  
|Restricted cash                                                                              |   | 2,100   |  
|Accounts payable and
      accrued liabilities                                               |   | (2,280  | )
|Loans and
      borrowings                                                                   |   | (18,813 | )
|Asset retirement
      obligation                                                            |   | (2,145  | )
|Non-controlling interest                                                                     |   | (3,992  | )
|Goodwill                                                                                     |   | 47,730  |  
|Totalpurchase consideration                                                                  | $ | 106,340 |  

The purchase consideration was allocated to the fair value of
assets acquired and liabilities assumed, based on an independent valuation
report and management's best estimates.

Pro forma information (unaudited)

Pro forma results of operations have been prepared as if the
Uranerz acquisition had occurred at January 1, 2015. The pro forma consolidated
financial statement information is not intended to be indicative of the results
that would actually have occurred, or the results expected in future periods,
had the events reflected herein occurred on the dates indicated. Any potential
synergies that may be realized and integration costs that may be incurred have
been excluded from the pro forma financial statement information.

For the year ended December 31, 2015, pro forma consolidated
revenue and net loss is $64.75 million and $88.70 million, respectively.
Included in pro forma net loss is a total of $6.89 million of acquisition costs
incurred which included the issuance of 889,436 of common shares of the Company
issued for advisory fees, and to satisfy a portion of required change in control
payments.

5. RECEIVABLES

December31,
    
    
    December 31,2015
    
    
    2014CurrentTrade receivables - mineral
      concentrate sales
    $
    1,868
    
    $
    -Trade receivables - other
    
    749
    
    
    600$
    2,617
    
    $
    600Non-currentNotes receivable and other
    $
    1,096
    
    $
    1,048$
    1,096
    
    $
    1,048


During the year ended December 31, 2014 the Company received
two notes with the principal totaling $1.05 million due in 2018 in connection
with the sale of certain assets previously recorded as held for sale. These
notes carry a 3% annual interest payment. The Company has setup a reserve of
$0.22 million (2014 - $0.22 million) against the collectability of these
receivables.

F-15

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

6. INVENTORIES

December31,
    
    
    December 31,2015
    
    
    2014Concentrates and
      work-in-progress
    $
    19,900
    
    $
    27,595Inventory of ore in stockpiles
    
    7,767
    
    
    2,000Raw materials and consumables
    
    3,004
    
    
    2,944$
    30,671
    
    $
    32,539Inventories - by durationCurrent
    $
    30,671
    
    $
    30,539Long-term - ore in stockpiles
    
    -
    
    
    2,000$
    30,671
    
    $
    32,539


The long-term portion of inventory of ore in stockpiles
represents ore that is not expected to be processed within the next year.

7. INTANGIBLE ASSETS

The following is a summary of changes in intangible assets
related to favorable sales contracts acquired in business combinations for the
years ended December 31, 2015 and December 31, 2014:

|                                                                      |   | December31, |  |   | December 31, | 
|--------------------------------------------------------------------- | - | ----------- |  | - | ------------ | 
|SalesContracts                                                        |   | 2015        |  |   | 2014         | 
|Cost                                                                  |   |             |  |   |              | 
|Balance at beginning of period                                        | $ | 15,851      |  | $ | 15,851       | 
|Sales
      contracts acquired in the acquisition of Uranerz (Note 4) |   | 10,600      |  |   | -            | 
|Balance, end of period                                                |   | 26,451      |  |   | 15,851       | 
|                                                                      |   |             |  |   |              | 
|Accumulated amortization, beginning of
      period                   |   | 11,970      |  |   | 8,079        | 
|Amortization of sales contracts                                       |   | 5,364       |  |   | 3,891        | 
|Accumulated amortization, end of period                               |   | 17,334      |  |   | 11,970       | 
|                                                                      |   |             |  |   |              | 
|Net book value                                                        | $ | 9,117       |  | $ | 3,881        | 

The sales contracts acquired in the acquisition of Uranerz were
recorded at their acquisition date fair value, which are the incremental cash
flows available to the Company arising from above-market pricing of the
contracts. The contracts have no
residual value and a weighted average expected economic life of 1.46 years.
Estimated amortization expense is as follows: (2016 - $3.47 million, 2017 -
$3.45 million, 2018  $2.14 million, 2019 - $0.05 million, 2020  nil).

8. PLANT AND EQUIPMENT AND MINERAL PROPERTIES

The following is a summary of plant and equipment:

F-16

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

December31,
    
    
    
    
    
    
    
    
    December
      31,2015
    
    
    
    
    
    
    
    
    2014Accumulated
    
    
    **Net Book**
    
    
    
    
    
    Accumulated
    
    
    Net BookCost
    
    
    Depreciation
    
    
    Value
    
    
    Cost
    
    
    Depreciation
    
    
    ValuePlant and equipmentNichols Ranch
    $
    29,210
    
    $
    (2,370
    )
    $
    26,840
    
    $
    -
    
    $
    -
    
    $
    -Equipment
      and other
    
    13,107
    
    
    (10,878
    )
    
    2,229
    
    
    11,423
    
    
    (10,688
    )
    
    735Plant and equipment total
    $
    42,317
    
    $
    (13,248
    )
    $
    29,069
    
    $
    11,423
    
    $
    (10,688
    )
    $
    735


The net book value for Nichols Ranch includes the value
ascribed to the processing plant and equipment. The mineral properties acquired
as part of the Uranerz acquisition are recorded as mineral properties, as the
Company does not have any proven or probable reserves under SEC Industry Guide 7
all expenditures at the Nichols Ranch plant and equipment which do not have any
alternative use and the mineral properties acquired are expensed as incurred.

For the year ended December 31, 2015, the Company recorded
$2.37 million (2014Nil; 2013 - Nil) of depreciation expense related to Nichols
Ranch plant and equipment, which is included in the costs and expenses applicable to revenue in the
statement of operations and comprehensive income for the year ended December
31, 2015.

The following is a summary of mineral properties:

|                       |   | December31, |  |   | December31, | 
|---------------------- | - | ----------- |  | - | ----------- | 
|                       |   | 2015        |  |   | 2014        | 
|Mineralproperties      |   |             |  |   |             | 
|In-situRecovery        |   |             |  |   |             | 
|Uranerz ISR properties | $ | 36,096      |  | $ | -           | 
|In-situRecoverytotal   | $ | 36,096      |  | $ | -           | 
|Conventional           |   |             |  |   |             | 
|Sheep Mountain         |   | 34,183      |  |   | 34,183      | 
|Roca Honda (1)         |   | 19,465      |  |   | 16,507      | 
|Other                  |   | 1,287       |  |   | 9,822       | 
|Conventionaltotal      |   | 54,935      |  |   | 60,512      | 
|MineralPropertiestotal | $ | 91,031      |  | $ | 60,512      | 

| | (1) | During the year ended December 31, 2015 the Company
      acquired mineral interests adjacent to the Roca Honda for consideration
      totaling $2.96 million.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------

9. IMPAIRMENTS

Impairment of Goodwill

The Company recorded Goodwill of $47.73 million associated with
the acquisition of Uranerz on June 18, 2015. The Goodwill represents the excess
of the acquisition date fair value of the  purchase consideration, over the fair
value of the assets acquired, net of obligations assumed, and is ascribed to the
reporting unit.

Since the acquisition of Uranerz, uranium spot market prices have fallen
about 20% and the value of the Companys shares and related market
capitalization have decreased significantly. As a result, during the Companys
annual impairment test for Goodwill performed as of December 31, 2015 the
Company evaluated the carrying amount of the Goodwill and determined that the
Goodwill should be fully impaired (refer to note 20 for disclosure of the
Companys valuation methodology).

Impairment of plant and equipment, mineral properties and
mineral properties held for sale

The Company conducts a review of potential triggering events
for all its mineral properties on a quarterly basis. When events or changes in
circumstances indicate that the related carrying amounts may not be recoverable,
the Company carries out a review and evaluation of its long-lived assets in
accordance with its accounting policy.

F-17

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

2015

In the year ended December 31, 2015, the Company identified
indicators of impairment of its mineral properties due to the decline in the
uranium concentrate spot and long-term prices and deterioration in the Companys
expectation of future uranium concentrate prices with respect to the Company's
mineral properties. An impairment analysis was performed for these properties
using the assumptions listed in note 20. The Company compared the undiscounted
cash flows for the mineral properties tested with their carrying amounts. No
impairment was considered necessary with respect of Roca Honda, Sheep Mountain
properties and the recently acquired ISR mineral properties, with the exception
of properties being held for sale or which were abandoned, since the
undiscounted cash flows exceeded the carrying amounts for the properties. With
respect of mineral properties identified as held for sale and properties which
were abandoned, the Company recorded an impairment  totaling $10.99
million.

With respect of mineral properties identified as held for sale,
the Company recorded an impairment of $8.22 million. The impaired properties
included Copper King, Marquez Ranch, Gas Hills, Juniper Ridge and the Nose Rock
(December 31, 2014  Copper King and Marquez Ranch). These properties are
classified in the other category of the conventional segment. The impairment of
$8.22 million was based of the estimate of its fair value determined using the
market approach less projected selling costs. Subsequent to December 31, 2015
Copper King, Marquez Ranch and Nose Rock mineral interests with a carrying
amount of $1.30 million were sold in separate transactions for gross proceeds
totaling $1.36 million.

With respect of properties which were abandoned, the Company
recorded an impairment of $2.77 million of which $0.47 million related to the
properties within the ISR segment. Additionally, during the review of the
mineral properties abandoned, the Company identified $2.30 million of mineral
properties where annual leases were not renewed and abandoned during the year
ended December 31, 2014 but had not been impaired in that year. These properties
have been impaired and included in the impairment of mineral properties for the
year ended December 31, 2015.

2014

In the year ended December 31, 2014, the Company identified
indicators of potential impairment of its plant and equipment and mineral
properties due to the decline in the uranium concentrate spot and long-term
prices from April 1, 2014 through July 31, 2014 and a significant deterioration
in the Companys expectation of future uranium concentrate prices with respect
to the Company's White Mesa Mill together with its conventional mining projects
located in the Colorado Plateau, Henry Mountains and Arizona Strip geographic
regions representing an asset group (collectively referred to as WMM asset
group). Refer to note 20 for a discussion of the valuation methodologies used.
Based on the impairment analysis, the Company recorded an impairment loss of
$75.05 million for the conventional uranium recovery segment, in the quarter
ended June 30, 2014, with respect to the WMM asset group. No impairment was
required with respect to the Companys conventional mining projects of Sheep
Mountain and Roca Honda located in Wyoming and New Mexico since the undiscounted
cash flows exceeded the carrying amounts for the properties. The Company also
reclassified $7.53 million of conventional uranium recovery segment from plant
and equipment to assets held for sale, tested the carrying value of the assets
and recorded an impairment of $5.02 million based of the estimate of its fair
value determined using the market approach less projected selling costs.

2013

During the year ended December 31, 2013, a review and
subsequent evaluation of mineral properties did not result in any impairment of
WMM asset group or the Companys conventional mining projects of Sheep Mountain
and Roca Honda located in Wyoming and New Mexico.

10. ASSET RETIREMENT OBLIGATION AND RESTRICTED CASH

The following table summarizes the Companys ARO:

F-18

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

|                                                                      |   | December31, |   |   | December 31, |      
|--------------------------------------------------------------------- | - | ----------- | - | - | ------------ | -----
|                                                                      |   | 2015        |   |   | 2014         |      
|Asset retirement obligation, beginning of
      period                | $ | 5,683       |   | $ | 6,780        |      
|Revision of estimate                                                  |   | 877         |   |   | 9            |      
|Acquisition of Uranerz (Note
      4)                                 |   | 2,145       |   |   | -            |      
|Transfer of liability associated with the sale
      of mining assets |   | -           |   |   | (321         | )    
|Accretion of liabilities                                              |   | 494         |   |   | 412          |      
|Settlements                                                           |   | (626        | ) |   | **(1,197**   | **)**
|Asset retirement obligation, end of period                            | $ | 8,573       |   | $ | 5,683        |      
|Asset retirement obligation:                                          |   |             |   |   |              |      
|Current                                                               | $ | 1,000       |   | $ | 121          |      
|Non-current                                                           |   | 7,573       |   |   | 5,562        |      
|Asset retirement obligation, end of period                            | $ | 8,573       |   | $ | 5,683        |      

Revision of estimates is as a result of a change in estimates
of the amount or timing of cash flows to settle ARO. Changes to the ARO are
recorded in profit and loss.

The ARO of the Company are subject to legal and regulatory
requirements. Estimates of the costs of reclamation are reviewed periodically by
the applicable regulatory authorities. The above provision represents the
Companys best estimate of the present value of future reclamation costs,
discounted using credit adjusted risk-free interest rates ranging from 8.5% to
11.5% and an inflation rate of 2.0% (December 31, 2014  2.0%) . The total
undiscounted decommissioning liability as at December 31, 2015 is $32.30 million
(December 31, 2014 - $26.60 million). Reclamation costs are expected to be
incurred between 2015 and 2038 in the following manner: 2016  2020 - $2.83
million, 2021  2025 - $2.32 million, 2026  2030 - $2.69 million, 2031  2035 -
$8.78 million, 2036  2038 - $15.68 million.

Restricted cash, which is held by or for the benefit of
regulatory agencies to collateralize future obligations, are comprised of the
following:

|                                           |   | December31, |   |   | December 31, |  
|------------------------------------------ | - | ----------- | - | - | ------------ | -
|                                           |   | 2015        |   |   | 2014         |  
|Restricted cash, beginning of period       | $ | 16,148      |   | $ | 25,478       |  
|Restricted cash from acquisitions (Note 4) |   | 2,100       |   |   | -            |  
|Refunds and returns for the period         |   | (5,268      | ) |   | (9,330       | )
|Restricted
      cash, end of period       | $ | 12,980      |   | $ | 16,148       |  

The Company has cash, cash equivalents and fixed income
securities as collateral for various bonds posted in favor of the State of Utah,
the State of Wyoming, the applicable state regulatory agencies in Colorado and
Arizona and the U.S. Bureau of Land Management for estimated reclamation costs
associated with the White Mesa mill and mining properties. Cash equivalents are
short-term highly liquid investments with original maturities of three months or
less. The restricted cash will be released when the Company has reclaimed a
mineral property or restructured the surety and collateral arrangements. During
the year ended December 31, 2015, the Company had a net refunds and returns of
$5.27 million from its collateral account (December 31, 2014 -$9.33 million)
primarily as a result of the restructuring of the Companys surety arrangements
and the reduction of bonding requirements at some of the Companys projects due
to reclamation activities completed. See Note 17 for a discussion of the
Companys surety bond commitments.

11. LOANS AND BORROWINGS

The contractual terms of the Companys interest-bearing loans
and borrowings, which are measured at amortized cost, and the Companys
convertible debentures which are measured at fair value, are as follows.

F-19

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

December31,
    
    
    December 31,2015
    
    
    2014Current portion of loans and
      borrowings:Secured note (b)
    $
    250
    
    $
    -Wyoming Industrial
      Development Revenue Bond loan (c)
    
    3,291
    
    
    -Finance leases and other
    
    41
    
    
    46Totalcurrentloansandborrowings
    $
    3,582
    
    $
    ****46Long-term loans and borrowings:Convertible debentures
      (a)
    $
    14,624
    
    $
    15,740Secured note (b)
    
    224
    
    
    -Wyoming Industrial
      Development Revenue Bond loan(c)
    
    14,078
    
    
    -Finance leases and other
    
    11
    
    
    46Totallong-termloansandborrowings
    $
    28,937
    
    $
    15,786


Terms and debt repayment schedule

Terms and conditions of outstanding loans were as follows:

December31,
    
    
    December
      31,2015
    
    
    2014Nominalinterest
    
    
    Yearof
    
    
    
    
    
    Carrying
    
    
    
    
    
    CarryingCurrency
    
    
    rate
    
    
    maturity
    
    
    Facevalue
    
    
    **amount**
    
    
    Face
      value
    
    
    amountConvertible debentures (a)
    
    CDN$
    
    
    8.5%
    
    
    2017
    
    $
    15,896
    
    $
    14,624
    
    $
    20,684
    
    $
    15,740Secured note (b)
    
    USD
    
    
    7%
    
    
    2017
    
    
    500
    
    
    474
    
    
    -
    
    
    -Wyoming Industrial Development 
    Revenue Bond loan(c)
    
    USD
    
    
    5.75%
    
    
    2020
    
    
    20,000
    
    
    17,369
    
    
    -
    
    
    -Finance leases and other
    
    USD
    
    
    7%
    
    
    2013-2017
    
    
    150
    
    
    52
    
    
    185
    
    
    92$
    36,546
    
    $
    32,519
    
    $
    20,869
    
    $
    15,832


| | (a) | On July 24, 2012, the Company completed a bought deal
      public offering of 22,000 floating-rate convertible unsecured subordinated
      debentures maturing June 30, 2017 (the Debentures). The Debentures were
      issued at a price of Cdn$1,000 per Debenture for gross proceeds of $21.55
      million (the Offering). The Debentures are convertible into common
      shares at the option of the holder at a conversion price of Cdn$15.00 per
      common share. Interest is paid in cash and in addition, unless an event of
      default has occurred and is continuing, the Company may elect, from time
      to time, subject to applicable regulatory approval, to satisfy its
      obligation to pay interest on the Debentures, on the date it is payable
      under the indenture (i) in cash; (ii) by delivering sufficient common
      shares to the debenture trustee, for sale, to satisfy the interest
      obligations in accordance with the indenture in which event holders of the
      Debentures will be entitled to receive a cash payment equal to the
      proceeds of the sale of such common shares; or (iii) any combination of
      (i) and (ii).
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |     | The Debentures accrue interest, payable semi-annually in
      arrears on June 30 and December 31 of each year at a fluctuating rate, of
      not less than 8.5% and not more than 13.5%, indexed to the simple average
      spot price of uranium as reported on the UxC Weekly Indicator Price.
      Interest can be paid in cash or issuance of the Companys common shares.
      The Debentures may be redeemed in whole or part, at par plus accrued
      interest and unpaid interest by the Company between June 30, 2015 and June
      30, 2017 subject to certain terms and conditions, provided the volume
      weighted average trading price of the common shares of the Company on the
      TSX during the 20 consecutive trading days ending five days preceding the
      date on which the notice of redemption is given is not less than 125% of
      the conversion price.                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |     | Upon redemption or at maturity, the Company will repay
      the indebtedness represented by the Debentures by paying to the debenture
      trustee in Canadian dollars an amount equal to the aggregate principal
      amount of the outstanding Debentures which are to be redeemed or which
      have matured, as applicable, together with accrued and unpaid interest
      thereon.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

F-20

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

| |     | Subject to any required regulatory approval and provided
      no event of default has occurred and is continuing, the Company has the
      option to satisfy its obligation to repay the Cdn$1,000 principal amount
      of the Debentures, in whole or in part, due at redemption or maturity,
      upon at least 40 days and not more than 60 days prior notice, by
      delivering that number of common shares obtained by dividing the Cdn$1,000
      principal amount of the Debentures maturing or to be redeemed as
      applicable, by 95% of the volume-weighted average trading price of the
      common shares on the TSX during the 20 consecutive trading days ending
      five trading days preceding the date fixed for redemption or the maturity
      date, as the case may be.                                                                                                                                                                                                                                                                                                                                                                                        
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     | The debentures are classified as fair value through
      profit or loss where the debentures are measured at fair value based on
      the closing price on the TSX (a level 1 measurement) and changes are
      recognized in earnings. For the year ended December 31, 2015 the Company
      recorded a loss on revaluation of convertible debentures of $1.55 million
      (December 31, 2014  ($0.30 million)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (b) | In February 2015 the Company issued a secured note in the
      amount of $0.45 million for a 50% interest in a joint venture with an
      effective interest rate of 7%. The remaining balance of the note is
      repayable on the following schedule: February 13, 2016 ($0.25 million),
      and February 13, 2017 ($0.25 million). The current portion of this note is
      $0.25 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (c) | The Company through its acquisition of Uranerz assumed an
      $18.58 million loan through the Wyoming Industrial Development Revenue
      Bond program (the "Loan"). The Loan has an annual interest rate of 5.75%
      and is repayable over seven years, maturing on October 15, 2020. The Loan
      originated on December 3, 2013 and required the payment of interest only
      for the first year, with the amortization of principal plus interest over
      the remaining six years. The Loan can be repaid earlier than its maturity
      date if the Company so chooses without penalty or premium. The Loan is
      secured by a charge on most of the assets of the Companys wholly owned
      subsidiary, Uranerz, including mineral properties, the processing
      facility, and equipment as well as an assignment of all of Uranerz
      rights, title and interest in and to its product sales contracts and other
      agreements. Uranerz is also subject to dividend restrictions. Principal
      and interest are paid on a quarterly basis on the first day of January,
      April, July and October. The current portion of the note is $3.29
      million.

12. CAPITAL STOCK

Authorized capital stock

The Company is authorized to issue an unlimited number of
Common Shares without par value, unlimited Preferred Shares issuable in series,
and unlimited Series A Preferred Shares. The Series A Preferred shares are
non-redeemable, non-callable, non-voting and with no right to dividends. The
Preferred Shares issuable in series will have the rights, privileges,
restrictions and conditions assigned to the particular series upon the Board of
Directors approving their issuance.

Share consolidation

At a special meeting held on October 30, 2013, the Companys
shareholders approved a share consolidation, in which fifty common shares of the
Company were exchanged for one new common share. The share consolidation
occurred on November 5, 2013. All share and per share amounts in these
consolidated financial statements have been restated to reflect the share
consolidation.

Issued capital stock

The significant transactions relating to capital stock issued
for the three years ended December 31, 2015 are as follows:

|a) | In the year ended December 31, 2015 the Company issued
      1,275,908 shares under the Companys at-the-market offering (the ATM)
      for proceeds of $2.94 million.                                                                                                                                                                                                                                                           
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                       
|b) | On June 18, 2015 the Company issued 24,457,773 shares for
      the acquisition of Uranerz Energy Corp valued at $101.75
million.                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | Pursuant to the acquisition of Uranerz, the Company
      issued 617,832 EFI common shares valued at $2.57 million in satisfaction
      of an advisory fee. The value of the Energy Fuels shares issued for the
      advisory fee was calculated using the share price of the Companys shares
      on the date the acquisition closed and these costs were expensed in the
      consolidated financial statements of the Company.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | On June 25, 2015 the Company issued 271,604 EFI common
      shares valued at $1.36 million to former employees
of Uranerz in consideration for termination liabilities. The
      value of the Energy Fuels shares issued was calculated using the share
      price of the Companys shares on the date the shares were issued. These
      costs were expensed in the consolidated financial statements of the
Company.            

F-21

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

|c) | On October 16, 2013 the Company completed an offering of
      625,000 shares at a price of Cdn$8.00 ($7.73) for total gross proceeds of
      $4.83 million. Also included in the consideration are 30,963 compensation
      warrants where each whole warrant entitles the holder to purchase one
      common share at a price of Cdn$8.00 until October 16, 2016. The fair value
      of the 30,963 compensation warrants that were issued on the completion of
      the offering totaled $0.06 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|d) | On August 29, 2013 the Company completed the acquisition
      of Strathmore Minerals Corporation (Strathmore) in exchange for
      3,665,395 Energy Fuels common shares at Cdn$10.50 ($10.00) per share
      aggregating to $36.47 million, plus 63,024 EFI common shares at Cdn$10.50
      (S10.00) per share aggregating to $0.63 million for replacement of
      Strathmores restricted share units which had fully vested upon
      acquisition by EFI.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Pursuant to the acquisition of Strathmore, the Company
      issued 55,095 EFI common shares valued at $0.55 million in satisfaction of
      an advisory fee. The value of the Energy Fuels shares issued was
      calculated using the share price of the Companys shares on the date the
      acquisition closed. These costs were expensed in the consolidated
      financial statements of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | On September 11, 2013 the Company issued 107,645 shares
      valued at $0.99 million to former employees of Strathmore in consideration
      for termination liabilities of certain employees. The value of the Energy
      Fuels shares issued was calculated using the share price of the Companys
      shares on the date the shares were issued. These costs were expensed in
      the consolidated financial statements of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|e) | On June 13, 2013, the Company completed an equity private
      placement of 947,616 non-transferable subscription receipts at a price of
      Cdn$7.00 ($6.75) per subscription receipt for gross total proceeds of
      $6.52 million. Each subscription receipt was exchangeable into one unit of
      the Company. Each unit consisted of one common share and one-half of one
      warrant. Each whole warrant entitles the holder to purchase one additional
      common share at a price of Cdn$9.50 until June 15, 2015. Also included in
      the consideration are compensation warrants where each whole warrant
      entitles the holder to purchase one common share at a price of Cdn$9.00
      until June 15, 2015. The fair value of the 473,808 full warrants and the
      50,594 compensation warrants that were issued on the completion of the
      private placement totaled $0.84 million and this value was recorded in
      capital stock.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|f) | On January 28, 2013, pursuant to a private placement, the
      Company issued 437,028 common shares of the Company to acquire 9,439,857
      common shares of Virginia Energy Resources Inc. for $3.95 million. The
      9,439,857 common shares acquired by the Company represented 16.5% of
      Virginia Energys common shares outstanding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

Share Purchase Warrants

The following table summarizes the Companys share purchase
warrants denominated in Cdn$:

ExercisePrice
    WarrantsMonthIssued
    ExpiryDate
    Cdn$
    OutstandingJune 2012
    June 22, 2016
    13.25
    351,025June 2013
    June 15, 2016
    9.50
    456,948


The following weighted average assumptions were used for the
Black-Scholes option pricing model to calculate the $1.46 million of fair value
for the 355,005 warrants issued in connection with the June 2012 private
placement:

Risk-free rate
    1.22%Expected life
    3.0 yearsExpected volatility
    82%*Expected dividend yield
    0.0%


The following weighted average assumptions were used for the
Black-Scholes option pricing model to calculate the $0.84 million of fair value
for the 524,402 warrants issued in connection with the June 2013 private
placement.

F-22

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|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Risk-free rate
    1.016%Expected life
    2.0 yearsExpected volatility
    94%*Expected dividend yield
    0.0%


| | * | Expected volatility is measured based on the Companys
      historical share price volatility over the expected life of the
      warrants.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------

In the year ended December 31, 2015 the Company issued 300
shares upon exercise of share purchase warrants at an average exercise price of
$7.61 (Cdn$9.50) for proceeds of less than $0.01 million.

In the year ended December 31, 2014 the Company issued 61,301
shares upon exercise of share purchase warrants at an average exercise price of
$7.88 (Cdn$8.72) for proceeds of $0.48 million.

The following table summarizes the Companys share purchase
warrants denominated in USD:

ExercisePrice
    WarrantsMonthIssued
    ExpiryDate
    USD
    OutstandingJune 2015
    March 5, 2016
    6.28
    1,058,250June 2015
    January 25, 2017
    6.28
    1,224,000


These warrants were issued as Uranerz replacement warrants and
are accounted for as a derivative liability within accounts payable as they do
not meet the definition of equity as they are priced in USD while the functional
currency of the Companys parent is Cdn$ and have a fair value of $0.26 million.
0.41 million and 1.06 million warrants expired unexercised on December 5, 2015
and March 5, 2016, respectively.

The following weighted average assumptions were used for the
Black-Scholes option pricing model to calculate the $0.91 million of fair value
for the 2,690,250 warrants issued in connection with the acquisition of Uranerz.

Risk-free rate
    0.16  0.65%Expected life
    0.18  1.07 yearsExpected volatility
    65  98%*Expected dividend yield
    0.0%


| | * | Expected volatility is measured based on the Companys
      historical share price volatility over the expected life of the
      warrants.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------

13. BASIC AND DILUTED LOSS PER COMMON SHARE Weighted average
number of common shares (basic)

The following is a reconciliation of weighted average shares
outstanding for the years ended December 31, 2015, December 31, 2014 and
December 31, 2013:

|                                                                      |  |            |  |  | Yearended   |  |  |            | 
|--------------------------------------------------------------------- |  | ---------- |  |  | ----------- |  |  | ---------- | 
|                                                                      |  |            |  |  | December31, |  |  |            | 
|                                                                      |  | 2015       |  |  | 2014        |  |  | 2013       | 
|Issued common shares at beginning of period                           |  | 19,677,552 |  |  | 19,601,251  |  |  | 13,642,672 | 
|Effect of share options exercised                                     |  | 22,938     |  |  | 11,137      |  |  | -          | 
|Effect of shares issued
      for exercise of share purchase warrants |  | 173        |  |  | 49,273      |  |  | -          | 
|Effect of shares issued in business
      combinations                |  | 13,654,488 |  |  | -           |  |  | -          | 
|Effect of shares issued in
      asset acquisitions                   |  | -          |  |  | -           |  |  | 1,425,052  | 
|Effect of shares issued in private placements                         |  | -          |  |  | -           |  |  | 932,233    | 
|Effect of shares issued in public offerings                           |  | 28,821     |  |  | -           |  |  | 130,495    | 
|Weightedaveragesharesoutstanding                                      |  | 33,383,972 |  |  | 19,661,661  |  |  | 16,130,452 | 

F-23

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

Diluted loss per share

For the three years ended December 31, 2015, 2014 and 2013, 5,213,120,
1,984,482 and 1,935,688 options and warrants, respectively, and the potential
conversion of the uranium debentures have been excluded from the calculation as
their effect would have been anti-dilutive.

The calculation of diluted earnings per share after adjustment
for the effects of all potential dilutive common shares, calculated as follows:

|                                                                             |  |            |   |  | Yearended   |   |  |            |  
|---------------------------------------------------------------------------- |  | ---------- | - |  | ----------- | - |  | ---------- | -
|                                                                             |  |            |   |  | December31, |   |  |            |  
|                                                                             |  | 2015       |   |  | 2014        |   |  | 2013       |  
|Loss attributable to shareholders                                            |  | ($82,217   | ) |  | ($86,635    | ) |  | ($36,590   | )
|Basic and diluted
      weighted average number of common shares outstanding |  | 33,383,972 |   |  | 19,661,661  |   |  | 16,130,452 |  
|Losspercommonshare                                                           |  | ($2.46     | ) |  | ($4.41      | ) |  | ($2.27     | )

14. SHARE-BASED PAYMENTS

The Company has stock incentive plans for directors, executives
and eligible employees. Stock incentive awards include employee stock options
and restricted stock units (RSUs). The Company issues new shares of common
stock to satisfy exercises and vesting under all of its stock incentive awards.
At December 31, 2015, a total of 4,654,005 shares were authorized for stock
incentive plan awards.

Employee Stock Options

The Company has established a stock option plan whereby the
Board of Directors may grant options to employees, directors and consultants to
purchase common shares of the Company. The exercise price of the options is set
as the higher of the Companys closing share price on the day before the grant
date or the five-day volume weighted average price. Stock options granted under
the Companys stock incentive plans generally vest over periods of two years or
more and are generally exercisable over a period of five years from the grant
date not to exceed 10 years. The value of each option award is estimated at the
grant date using the Black-Scholes option pricing model. There were 2.18 million
options granted in 2015, 0.31 million options granted in 2014 and 0.50 million
options granted in 2013. At December 31, 2015, there were 2.12 million options
outstanding (2014: 0.9 million options) with 1.92 million options (2014: 0.77
million options) exercisable, at a weighted average
exercise price of $6.54 (2014: $10.05), with a weighted average remaining contractual life of
4.27 years (2014: 2.75 years).

The summary of the Companys stock options at December 31, 2015
and December 31, 2014, and the changes for the fiscal periods ending on those
dates is presented below:

|                                |  | Year ended         |  |  | Year ended        | 
|------------------------------- |  | ------------------ |  |  | ----------------- | 
|                                |  | December 31, 2015  |  |  | December 31, 2014 | 
|                                |  |                    |  |  |                   | 
|                                |  |                    |  |  | Weighted          | 
|                                |  | Range of           |  |  | Average           | 
|                                |  | Exercise Prices    |  |  | Exercise Price    | 
|                                |  | **$**              |  |  | **$**             | 
|Balance, beginning of period    |  | 6.55 -
      38.12 |  |  | 10.05             | 
|Transactions during the period: |  |                    |  |  |                   | 
|Granted                         |  | 2.55 -
      18.55 |  |  | 6.02              | 
|Exercised                       |  | 2.55 - 4.48        |  |  | 3.78              | 
|Forfeited                       |  | 4.44 -
      29.71 |  |  | 7.29              | 
|Expired                         |  | 7.47 - 32.10       |  |  | 7.42              | 
|Balance, end of period          |  | 2.55 - 32.10       |  |  | 6.54              | 

The fair value of stock options granted and issued as
replacements in business combinations and asset acquisitions during the years
ended December 31, 2015, 2014 and 2013 is as follows:

|                                                                                |   |       |  |   | Yearended   |  |   |       | 
|------------------------------------------------------------------------------- | - | ----- |  | - | ----------- |  | - | ----- | 
|                                                                                |   |       |  |   | December31, |  |   |       | 
|                                                                                |   | 2015  |  |   | 2014        |  |   | 2013  | 
|Share option plan expense (1)                                                   | $ | 1,099 |  | $ | 1,405       |  | $ | 1,268 | 
|Replacement options from business combinations and asset
      acquisitions (2) |   | 3,681 |  |   | -           |  |   | 270   | 
|Value of stock options granted                                                  | $ | 4,780 |  | $ | 1,405       |  | $ | 1,538 | 

|(1) | The fair value of the options granted under the Plan was
      estimated at the date of grant, using the Black-Scholes Option Valuation
      Model, with the following weighted-average
assumptions:
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                         |   | 2015      |  |   | 2014      |  |   | 2013            | 
|---------------------------------------- | - | --------- |  | - | --------- |  | - | --------------- | 
|Risk-free interest rate                  |   | 0.87 %    |  |   | 1.60 %    |  |   | 1.18% - 1.84%   | 
|Expected life                            |   | 5.0 years |  |   | 5.0 years |  |   | 1.2  5.0 years | 
|Expected volatility                      |   | 75.1 %*   |  |   | 81%*      |  |   | 60% - 95%*      | 
|Expected dividend yield                  |   | 0.00 %    |  |   | 0.00%     |  |   | 0.00%           | 
|Weighted-average expected life of option |   | 4.99      |  |   | 5.00      |  |   | 4.75            | 
|Weighted-average grant date fair value   | $ | 2.64      |  | $ | 5.27      |  | $ | 5.42            | 

| | * | Expected volatility is measured based on the Companys
      historical share price volatility over a period equivalent to the expected
      life of the options.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-24

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

|(2) | During business combinations and asset acquisitions the
      Company may issue options to replace options of the acquired companies.
      For the years ended December 31, 2015, 2014 and 2013 the fair value of
      stock options granted to employees, directors and consultants of companies
      acquired through business combinations and asset acquisitions was estimated on the
closing date of the transaction using the Black-Scholes option pricing model
with the following assumptions:
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                         |   | 2015             |  |  | 2014 |  |   | 2013            | 
|---------------------------------------- | - | ---------------- |  |  | ---- |  | - | --------------- | 
|Risk-free interest rate                  |   | 0.0% to 2.35%    |  |  | -    |  |   | 1.06% - 2.40%   | 
|Expected life                            |   | 0.05 to 10 years |  |  | -    |  |   | 0.2 - 9.2 years | 
|Expected volatility                      |   | 18.47 to 93.31%* |  |  | -    |  |   | 51% - 104%*     | 
|Expected dividend yield                  |   | 0.00%            |  |  | -    |  |   | 0.00%           | 
|Weighted-average expected life of option |   | 4.52             |  |  | -    |  |   | 0.79            | 
|Weighted-average grant date fair value   | $ | 1.89             |  |  | -    |  | $ | 0.92            | 

| | * | Expected volatility is measured based on the Companys
      historical share price volatility over a period equivalent to the expected
      life of the options.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------

Restricted Share Units

The Company grants RSUs to executives and eligible employees.
Awards are determined as a target percentage of base salary and vest over
periods of three years. Prior to vesting, holders of restricted stock units do
not have the right to vote the underlying shares. The restricted stock units are
subject to forfeiture risk and other restrictions. Upon vesting, the employee is
entitled to receive one share of the Companys common stock for each restricted
stock unit for no additional payment. During the year ended December 31, 2015, the Companys Board of
Directors approved the issuance of 282,716 RSUs under the Companys 2015 Omnibus
Equity Incentive Compensation Plan (the Compensation Plan). No RSUs were
issued in 2014 or 2013.

A summary of the status and activity of non-vested stock
options and RSUs for the year ended December 31, 2015 is as follows:

|                             |  | Stock-option |   |   | RSU  Weighted | 
|---------------------------- |  | ------------ | - | - | ------------- | 
|                             |  |              |   |   | Weighted      | 
|                             |  | Numberof     |   |   | AverageGrant- | 
|                             |  | shares       |   |   | DateFairValue | 
|Non-vested December 31, 2012 |  | -            |   | $ | -             | 
|Granted                      |  | 218,150      |   | $ | 5.42          | 
|Vested                       |  | (218,150     | ) | $ | 5.42          | 
|Forfeited                    |  | -            |   | $ | -             | 
|Non-vested December 31, 2013 |  | -            |   | $ | -             | 
|Granted                      |  | 307,250      |   | $ | 5.27          | 
|Vested                       |  | (153,625     | ) | $ | 5.27          | 
|Forfeited                    |  | (14,025      | ) | $ | 5.27          | 
|Non-vested December 31, 2014 |  | 139,600      |   | $ | 5.27          | 
|Granted                      |  | 2,176,330    |   | $ | 1.93          | 
|Vested                       |  | (2,097,272   | ) | $ | 1.83          | 
|Forfeited                    |  | (18,429      | ) | $ | 5.17          | 
|Non-vested December 31, 2015 |  | 200,229      |   | $ | 5.00          | 

The total intrinsic value and fair value of RSUs that vested in
2015 was $nil.

At December 31, 2015, there was $0.06 million, $0.39 million of
unrecognized compensation costs related to the unvested stock options and RSU
awards, respectively. This cost is expected to be recognized over a
weighted-average period of approximately two years.

In the year ended December 31, 2015 the Company issued 48,802
shares upon exercise of stock options at an average exercise price of $3.87 for
proceeds of $0.18 million. These options had an intrinsic value of $0.06
million.

In the year ended December 31, 2014 the Company issued 15,000
shares upon exercise of stock options at an average exercise price of $7.97
(Cdn$8.75) for proceeds of $0.12 million. These options had an intrinsic value
of $0.02 million.

15. INCOME TAXES

A reconciliation of income tax expense (recovery) and the
product of accounting income before income tax, multiplied by the combined
Canadian federal and provincial income tax rate (the rate applicable to the
Canadian parent company) is as follows:

F-25

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

|                                       |   |         |   |   | Yearended   |   |   |         |  
|-------------------------------------- | - | ------- | - | - | ----------- | - | - | ------- | -
|                                       |   |         |   |   | December31, |   |   |         |  
|                                       |   | 2015    |   |   | 2014        |   |   | 2013    |  
|Income (loss) before income taxes      | $ | (82,357 | ) | $ | (86,532     | ) | $ | (36,590 | )
|Combined federal and provincial rate   |   | 26.50%  |   |   | 26.50%      |   |   | 26.50%  |  
|                                       |   |         |   |   |             |   |   |         |  
|Expected income tax recovery           |   | (21,825 | ) |   | (22,931     | ) |   | (9,696  | )
|Stock based compensation               |   | 291     |   |   | 337         |   |   | 317     |  
|True-up                                |   | 281     |   |   | (307        | ) |   | 1,878   |  
|Other non-deductible/non-taxable items |   | (2,984  | ) |   | (743        | ) |   | 476     |  
|Foreign tax rate differences           |   | (10,180 | ) |   | (9,884      | ) |   | (3,040  | )
|Change in valuation allowance          |   | 34,417  |   |   | 33,631      |   |   | 10,065  |  
|Income tax expense                     | $ | (0      | ) | $ | 103         |   | $ | (0      | )

The Components of the net deferred tax assets and liabilities
as of December 31, 2015, 2014 and 2013 are as follows:

|                                      |   |          |   |   | Yearended   |   |   |         |  
|------------------------------------- | - | -------- | - | - | ----------- | - | - | ------- | -
|                                      |   |          |   |   | December31, |   |   |         |  
|                                      |   | 2015     |   |   | 2014        |   |   | 2013    |  
|Currentdeferredtaxassets              |   |          |   |   |             |   |   |         |  
|Deferred revenue                      | $ | -        |   | $ | 948         |   | $ | 538     |  
|Inventories                           |   | 1,415    |   |   | 1,677       |   |   | 962     |  
|Short-term
      investments          |   | 408      |   |   | 188         |   |   | (583    | )
|Total currentdeferredtaxassets        |   | 1,823    |   |   | 2,813       |   |   | 917     |  
|                                      |   |          |   |   |             |   |   |         |  
|Non-currentdeferredtaxassets          |   |          |   |   |             |   |   |         |  
|Operating loss carry forwards         |   | 86,807   |   |   | 60,012      |   |   | 63,690  |  
|Capital loss carry forwards           |   | 21,297   |   |   | 21,507      |   |   | -       |  
|Deferred revenue and other            |   | 3,987    |   |   | 1,719       |   |   | -       |  
|Mineral properties and deferred costs |   | 41,631   |   |   | 23,632      |   |   | 32,187  |  
|Asset retirement obligations          |   | 3,226    |   |   | 2,138       |   |   | 1,346   |  
|Intangibles and other                 |   | (3,772   | ) |   | (2,134      | ) |   | (986    | )
|Property,
      plant and equipment   |   | (1,348   | ) |   | 9,547       |   |   | (11,551 | )
|Totalnon-currentdeferredtaxassets     |   | 151,828  |   |   | 116,421     |   |   | 84,686  |  
|                                      |   |          |   |   |             |   |   |         |  
|Subtotal deferred tax asset           |   | 153,651  |   |   | 119,234     |   |   | 85,603  |  
|Less: valuation
      allowance       |   | (153,651 | ) |   | (119,234    | ) |   | (85,603 | )
|Net deferred tax asset                | $ | -        |   | $ | -           |   | $ | -       |  

At December 31, 2015, December 31, 2014 and December 31, 2013
the Company recorded a valuation allowance against the net deferred tax assets
for the above related items in the financial statements as management did not
consider it more likely than not that the Company will be able to realize the
deferred tax assets in the future.

The Consolidated Statement of Equity contains $0.08 million of
tax expense and benefit relating to the expiration of $0.59 million of warrants.

The following table summarizes the changes to the valuation
allowance:

FortheYear
    BalanceatEnded
    Beginningof
    
    
    BalanceatEndDecember31,
    Period
    Additions
    (a)
    Deductions
    (b)
    ofPeriod2015
    119,234
    49,582
    (15,165)
    153,6512014
    85,603
    48,501
    (14,870)
    119,2342013
    75,539
    27,411
    (17,347)
    85,603


|   |                                                                                                                                                                                                                                                                                                                                                       
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|a) | The additions to the valuation allowance result from additional
losses incurred, increases to other tax assets such as mineral property and
other increases arising from the acquisition of Uranerz Energy Corporation and
Strathmore Minerals Corp. Management does not feel these additions meet the
more-likely-than-not criterion for recognition.
|   |                                                                                                                                                                                                                                                                                                                                                       
|b) | The reductions to the valuation allowance result from
      foreign exchange rate reductions of tax attributes in Canada as well as
      utilization of tax deductions in excess of book deductions.                                                                                                                                                 

F-26

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

The following table summarize the Company's capital losses and
net operating losses as of December 31, 2015 that can be applied against future
taxable profit.

|Country       |  | Type                      |  |   | Amount  |  |  | Expiry Date | 
|------------- |  | ------------------------- |  | - | ------- |  |  | ----------- | 
|Canada        |  | Non-capital losses        |  | $ | 21,381  |  |  | 2027 - 2035 | 
|Canada        |  | Allowable Capital  losses |  |   | 3,125   |  |  | None        | 
|Canada        |  | Investment Tax Credits    |  |   | 1,136   |  |  | 2023 - 2026 | 
|United States |  | Net operating losses      |  |   | 215,613 |  |  | 2026 - 2035 | 
|United States |  | Capital losses            |  |   | 54,399  |  |  | 2019        | 

Utilization of the United States loss carry forwards will be
limited in any year as a result of previous changes in ownership. For the Energy
Fuels Holding Corporation and Subsidiaries consolidated group, management
estimates that approximately $75 million in net operating losses will expire
unutilized as a result of these limitations.

Utilization of the Canadian loss carry forwards will be subject
to the Acquisition of Control Rules in any year as a result of previous changes
in ownership.

16. SUPPLEMENTAL FINANCIAL INFORMATION

The components of revenues are as follows:

|                                              |   |        |  |   | Yearended   |  |   |        | 
|--------------------------------------------- | - | ------ |  | - | ----------- |  | - | ------ | 
|                                              |   |        |  |   | December31, |  |   |        | 
|                                              |   | 2015   |  |   | 2014        |  |   | 2013   | 
|Uranium concentrates                          | $ | 60,696 |  | $ | 45,755      |  | $ | 55,304 | 
|Vanadium concentrates                         |   | -      |  |   | -           |  |   | 8,779  | 
|Alternate feed materials processing and other |   | 655    |  |   | 498         |  |   | 238    | 
|Revenues                                      | $ | 61,351 |  | $ | 46,253      |  | $ | 64,321 | 

The Company has four major customers to which its sales for the
year were as follows: $20.98 million; $16.31 million; $12.53 million; $9.00
million (2014 - $20.66 million; $8.57 million; $16.53 million); (2013 - $26.94
million; $10.41 million; $26.40 million).

The Companys revenues by country of customer for the current
year were as follows: $37.85 million  U.S.; $20.98 million  South Korea; Other
- $1.87 million (2014 -$25.59 million - U.S.; $20.66 million - South Korea)
(2013 - $46.31 million - U.S.; $26.94 million - South Korea).

Deferred revenue at December 31, 2015 of $2.17 million (2014 -
$1.51 million) relates to proceeds received on delivery of alternate feed
materials in advance of the required processing activity.

The components of other income (expense) are as follows:

|                                                             |   |        |   |   | Yearended   |   |   |        |  
|------------------------------------------------------------ | - | ------ | - | - | ----------- | - | - | ------ | -
|                                                             |   |        |   |   | December31, |   |   |        |  
|                                                             |   | 2015   |   |   | 2014        |   |   | 2013   |  
|                                                             |   |        |   |   |             |   |   |        |  
|Interest income                                              | $ | 94     |   | $ | 47          |   | $ | 462    |  
|Foreign exchange gains (losses)                              |   | (7     | ) |   | 5           |   |   | 297    |  
|Change in value of investments accounted at
      fair value |   | 38     |   |   | (404        | ) |   | (3,366 | )
|Change in value of derivative liabilities                    |   | 590    |   |   | -           |   |   | -      |  
|Change in value of convertible debentures                    |   | (1,548 | ) |   | 300         |   |   | 691    |  
|Gain on sale of mineral properties                           |   | -      |   |   | 565         |   |   | -      |  
|Other                                                        |   | 413    |   |   | 922         |   |   | 164    |  
|Otherincome(expense)                                         | $ | (420   | ) | $ | 1,435       |   | $ | (1,752 | )

17. COMMITMENTS AND CONTINGENCIES

General legal matters

White Mesa Mill

In November, 2012, the Company was served with a Plaintiffs
Original Petition and Jury Demand in the District Court of Harris County, Texas,
claiming unspecified damages from the disease and injuries resulting from
mesothelioma from exposure to asbestos, which the Plaintiff claims was
contributed by being exposed to asbestos products and dust while working at the White Mesa Mill. The Company do not
consider this claim to have any merit, and therefore do not believe it will
materially affect its financial position, results of operations or cash flows.
In January, 2013, the Company filed a Special Appearance challenging
jurisdiction and certain other procedural matters relating to this claim. No
other activity involving the Company on this matter has occurred since that
date.

F-27

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

In January, 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 in the shallow aquifer at the
White Mesa Mill site. This challenge is currently being evaluated, and may
involve the appointment of an administrative law judge to hear the matter. The
Company does not consider this action to have any merit. If the petition is
successful, the likely outcome would be a requirement to modify or replace the
existing Corrective Action Plan. At this time, the Company does not believe any
such modification or replacement would materially affect our 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.

In April 2014, the Grand Canyon Trust filed a citizen suit in
federal district court for alleged violations of the Clean Air Act at the White
Mesa Mill. In October 2014, the plaintiffs were granted leave by the court to
add further purported violations to their April 2014 suit. The Complaint, as
amended, alleges that radon from one of the Mills tailings impoundments
exceeded the standard; that the mill is in violation of a requirement that only
two tailings impoundments may be in operation at any one time; and that certain
other violations related to the manner of measuring and reporting radon results
from one of the tailings impoundments occurred in 2013. The Complaint asks the
court to impose injunctive relief, civil penalties of up to $37,500 per day per
violation, costs of litigation including attorneys fees, and other relief. The
Company believes the issues raised in the Complaint are being addressed through
the proper regulatory channels and is currently in compliance with all
applicable regulatory requirements relating to those matters. The Company
intends to defend against all issues raised in the Complaint.

Canyon Project

In March, 2013, the Center for Biological Diversity, the Grand
Canyon Trust, the Sierra Club and the Havasupai Tribe (the Canyon
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 United States Forest Service (USFS) seeking an
order (a) declaring that the USFS failed to comply with environmental, mining,
public land, and historic preservation laws in relation to our Canyon Project,
(b) setting aside any approvals regarding exploration and mining operations at
the Canyon Project, and (c) directing operations to cease at the Project and
enjoining the USFS from allowing any further exploration or mining-related
activities at the Canyon Project until the USFS fully complies with all
applicable laws. In April 2013, the Plaintiffs filed a Motion for Preliminary
Injunction, which was denied by the District Court in September, 2013. On April
7, 2015, the District Court issued its final ruling on the merits in favor of
the Defendants and the Company and against the Canyon Plaintiffs on all counts.
The Canyon Plaintiffs appealed the District Courts ruling on the merits to the
Ninth Circuit Court of Appeals, and filed motions for an injunction pending
appeal with the District Court. Those motions for an injunction pending appeal
were denied by the District Court on May 26, 2015. Thereafter, Plaintiffs filed
urgent motions for an injunction pending appeal with the Ninth Circuit Court of
Appeals, which were denied on June 30, 2015. Briefing on the appeal on the
merits is now complete, and the parties are waiting for a hearing to be
scheduled. If the Canyon Plaintiffs are successful on their appeal on the
merits, the Company may be required to maintain the Canyon Project on standby
pending resolution of the matter. Such a required prolonged stoppage of shaft
sinking and mining activities could have a significant impact on our future
operations. The parties are currently briefing motions for summary judgement
relating to this litigation

Mineral property commitments

The Company enters into commitments with federal and state
agencies and private individuals to lease mineral rights. These leases are
renewable annually and annual renewal costs are expected to total $1.52 million
for the year ended December 31, 2016.

Surety bonds

The Company has indemnified third-party companies to provide
surety bonds as collateral for the Companys ARO. The Company is obligated to
replace this collateral in the event of a default, and is obligated to repay any
reclamation or closure costs due. The Company currently has $12.98 million
posted against an undiscounted ARO of $32.30 million.

F-28

---

18. SEGMENT INFORMATION

The Company Is engaged in uranium extraction, recovery and
sales of uranium from mineral properties and the recycling of uranium bearing
materials generated by third parties. As a part of these activities the Company
also acquires, explores, evaluates and, if warranted, permits uranium
properties. The Companys primary mining activities are in the United States.

The reportable segments are those operations whose operating
results are reviewed by the Chief Executive Officer to make decisions about
resources to be allocated to the segment and assess its performance provided
those operations pass certain quantitative thresholds. Operations whose
revenues, earnings or losses or assets exceed 10% of the total consolidated
revenue, earnings or losses or assets are reportable segments. Information about
assets and liabilities of the segment has not been provided because the information is
not used to assess performance.

In order to determine reportable operating segments, management
reviewed various factors, including geographical location and managerial
structure. It was determined by management that a reportable operating segment
generally consists of an individual property managed by a single general manager
and management team. Finance income (expense), other income (expenses) are
managed on a consolidated basis and are not allocated to operating segments.

Non-mining activities and other operations are reported in
Corporate and other.

The following tables set forth operating results by reportable
segment for the year ended December 31, 2015: Note the ISR Segment only includes
activity after its acquisition on June 18, 2015. Prior to the acquisition of
Uranerz, the Companys reportable segment was its conventional uranium segment.

|                                                          |   |                   |   |       |             |   |       | Non-Operating     |   |       |             |      
|--------------------------------------------------------- | - | ----------------- | - | ----- | ----------- | - | ----- | ----------------- | - | ----- | ----------- | -----
|                                                          |   | OperatingSegments |   |       | Segments    |   |       |                   |  
|                                                          |   |                   |   |       |             |   |       |                   |   |       |             |      
|Year Ended
      December 31, 2015                        |   | Conventional      |   |       | ISR         |   |       | Corporate & Other |   |       | Total       |      
|Revenue                                                   | $ | 48,448            |   | $     | 12,903      |   | $     | -                 |   |       | 61,351      |      
|Costs and expenses applicable to revenue                  |   | 28,161            |   |       | 9,456       |   |       | -                 |   |       | 37,617      |      
|Development, permitting and
      landholding             |   | 1,312             |   |       | 7,450       |   |       | -                 |   |       | 8,762       |      
|Stand by costs                                            |   | 10,765            |   |       | -           |   |       | -                 |   |       | 10,765      |      
|Accretion of asset retirement
      obligation            |   | 414               |   |       | 80          |   |       | -                 |   |       | 494         |      
|Selling costs                                             |   | 316               |   |       | -           |   |       | -                 |   |       | 316         |      
|Intangible asset amortization                             |   | 2,372             |   |       | 2,992       |   |       | -                 |   |       | 5,364       |      
|General and administration                                |   | 1,648             |   |       | 1,867       |   |       | 8,810             |   |       | 12,325      |      
|Costs directly attributable to
      acquisitions         |   | -                 |   |       | -           |   |       | 6,886             |   |       | 6,886       |      
|Impairment of  plant and equipment and mineral properties |   | 10,527            |   |       | 467         |   |       | -                 |   |       | 10,994      |      
|Impairment of goodwill                                    |   | -                 |   |       | 47,730      |   |       | -                 |   |       | 47,730      |      
|Total operating loss                                      |   | (7,067            | ) |       | **(57,139** | ) |       | **(15,696**       | ) |       | **(79,902** | **)**
|                                                          |   |                   |   |       |             |   |       |                   |   |       |             |      
|Interest Expense                                          |   | -                 |   |       | -           |   |       | (2,035            | ) |       | (2,035      | )    
|Other income (expense)                                    |   | -                 |   |       | -           |   |       | (420              | ) |       | (420        | )    
|Net loss                                                  | $ | (7,067            | ) | **$** | **(57,139** | ) | **$** | **(18,151**       | ) | **$** | **(82,357** | **)**
|Attributable to shareholders                              | $ | (7,067            | ) | $     | (56,999     | ) | $     | (18,151           | ) | $     | (82,217     | )    
|Non-controlling
      interests                           |   | -                 |   |       | (140        | ) |       | -                 |   |       | (140        | )    
|Net loss for the period                                   | $ | (7,067            | ) | **$** | **(57,139** | ) | **$** | **(18,151**       | ) | **$** | **(82,357** | **)**

F-29

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

19. UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION

The following table summarizes
unaudited supplementary quarterly information for the years ended December 31,
2015, 2014, and 2013.

|                                                                 |   | Threemonthsended                                                    |  
|---------------------------------------------------------------- | - | ------------------------------------------------------------------- | -
|                                                                 |   | March31,2015                                                        |  
|                                                                 |   | (unaudited) (in thousand, except share and
      per share amounts) |  
|Net loss                                                         | $ | (1,203                                                              | )
|                                                                 |   |                                                                     |  
|Net loss per share                                               | $ | (0.06                                                               | )
|                                                                 |   |                                                                     |  
|Weighted average shares outstanding
           Basic and Diluted |   | 19,677,552                                                          |  

|                                                                |   | Threemonthsended                                                    |  
|--------------------------------------------------------------- | - | ------------------------------------------------------------------- | -
|                                                                |   | March31,2014                                                        |  
|                                                                |   | (unaudited) (in thousand,
      except share and per share amounts) |  
|Net income (loss)                                               | $ | (6,671                                                              | )
|                                                                |   |                                                                     |  
|Net income (loss) per share                                     | $ | (0.34                                                               | )
|                                                                |   |                                                                     |  
|Weighted average shares outstanding
          Basic and Diluted |   | 19,601,773                                                          |  

|                                                                |   | Threemonthsended                                                    |  
|--------------------------------------------------------------- | - | ------------------------------------------------------------------- | -
|                                                                |   | March31 ,2013                                                       |  
|                                                                |   | (unaudited) (in thousand, except share and
      per share amounts) |  
|Net loss                                                        | $ | (11,703                                                             | )
|                                                                |   |                                                                     |  
|Net loss per share                                              | $ | (0.84                                                               | )
|                                                                |   |                                                                     |  
|Weighted average shares outstanding
          Basic and Diluted |   | 13,948,212                                                          |  

20. FAIR VALUE ACCOUNTING

Assets and liabilities measured at fair value on a
recurring basis

The following tables set forth
the fair value of the Company's assets and liabilities measured at fair value on
a recurring basis (at least annually) by level within the fair value hierarchy
as at December 31, 2015 and 2014. As required by accounting guidance, assets and
liabilities are classified in their entirety based on the lowest level of input
that is significant to the fair value measurement.

As at December 31, 2015, 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.

|                                 |   | Level 1 |   |   | Level 2 |   |   | Level 3 |  |   | Total   |  
|-------------------------------- | - | ------- | - | - | ------- | - | - | ------- |  | - | ------- | -
|Investments                      | $ | 489     |   | $ | -       |   | $ | -       |  | $ | -       |  
|Derivative liability             |   | -       |   |   | (262    | ) |   | -       |  |   | (262    | )
|Convertible debentures (Note 10) |   | (14,624 | ) |   | -       |   |   | -       |  |   | (14,624 | )
|                                 | $ | (14,135 | ) | $ | (262    | ) | $ | -       |  | $ | (14,886 | )

F-30

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

The Company's investments are
marketable equity securities which are exchange traded are valued using quoted
market prices in active markets and as such are classified within Level 1 of the
fair value hierarchy. The fair value of the investments is calculated as the
quoted market price of the marketable equity security multiplied by the quantity
of shares held by the Company.

Assets and liabilities measured at fair value on a
non-recurring basis

As discussed in Note 9,
Impairment, the Company recorded several impairment charges in the years
ended December 31, 2015 and 2014.

In the year ended December 31,
2015, the Company recorded an impairment charge of $47.73 million associated
with the Goodwill recognized in the acquisition of Uranerz on June 18, 2015. The
estimated fair value used in the December 31, 2015 impairment analysis was
determined 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 care and maintenance and operating costs.

In the second quarter of 2015, the Company recorded the fair
value of Nichols Ranch Project upon acquisition of Uranerz. The estimated fair
value used in the June 18, 2015 valuation was determined using discounted cash
flow projections and various other pricing scenarios. 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, future
care and maintenance and operating costs as well as precedent market
transactions data.

In the second quarter of 2014, the Company recorded an
impairment charge of $75.05 million, respectively, in relation to the White Mesa
Asset Group. The estimated fair value used in the June 30, 2014 impairment
analysis was determined using discounted cash flow projections and various other
pricing scenarios. 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 care and maintenance and
operating costs.

The following table sets forth a
summary of the quantitative and qualitative information related to the
unobservable inputs used in the calculation of the Company's non-recurring Level
3 fair value measurements for the year ended December 31, 2015 and 2014.

2015DateofFairValue
    
    
    Range/WeightedMeasurement
    ValuationTechnique
    UnobservableInput
    AverageNichols Ranch Project and mineral
      properties in the ISR and Conventional segments
    December 31, 2015
    Discounted Cash Flow Model
    Discount Rate Short and
      Long Term Uranium Price United States Inflation Rate
    10% $38.90 to $62.10
      2%Nichols Ranch Project
    June 18, 2015
    Discounted Cash Flow Model
    Discount Rate Short and Long Term Uranium
      Price United States Inflation Rate
    10% $37.95 to $65.00 2%Acquired Uranerz exploration properties
    June 18, 2015 and
      December 31, 2015
    Enterprise value to resource
      model and acreage multiple
    Precedent Transaction
      Research
    Measured & Indicated
      pounds U3O8- 2.00x Inferred Pounds
  U3O8- 1.50 x $77.00x - Acre


2014DateofFairValue
    
    
    Range/WeightedMeasurement
    ValuationTechnique
    UnobservableInput
    AverageWhite Mesa Asset Group
    June 30, 2014
    Discounted Cash Flow Model
    Discount Rate
    12.5%Short and Long Term
    Uranium Price
    $37.95 to $65.00United States Inflation
    
    Rate Monte Carlo Simulation
    2%


F-31

---

|ENERGY FUELS INC.                                                                              
|-----------------------------------------------------------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                 
|FOR THE THREE YEARS ENDED DECEMBER 31, 2015                                                    
|(Tabular amounts expressed in thousands of US Dollars
      except share and per share amounts)
|                                                                                               

21. SUBSEQUENT EVENTS

Issuance of stock options and restricted stock units
(RSU)

On January 27, 2016 the Company granted 0.42 million stock
options and 0.95 million RSUs to its employees, directors and consultants with
an exercise price of $2.12. The options carry a five-year life and are vested as
follows: 50% immediately; 25% on January 27, 2017; 25% on January 27, 2018. The
RSUs vest as follows: 50% on January 27, 2017; 25% on January 27, 2018; and 25%
on January 27, 2019.

Definitive agreement to acquire Mesteña

On March 4, 2016, the Company into a definitive agreement (the
Mesteña Purchase Agreement) between the Company and Mesteña Uranium, LLC,
Leoncito Plant, LLC, Leoncito Project, LLC (collectively, the Subject
Companies) and Mesteña, Inc., Jones Ranch Minerals Unproven, Ltd. and Mesteña
Unproven, Ltd. (collectively with the Subject Companies, the Selling Parties)
to acquire all of the membership interests of the Subject Companies. Mesteña is
a uranium recovery company that owns the Alta Mesa ISR uranium recovery project
(the Alta Mesa Project), located in Texas. The Alta Mesa Project has a
fully-licensed and constructed ISR uranium recovery plant, with a design
capacity of 1.5 million pounds of uranium concentrate per year. The recovery
plant is currently being maintained on standby. Under the Mesteña Purchase
Agreement, the Company has agreed to issue 4,551,284 common shares to the
Selling Parties at the closing of the transaction, which is expected to occur on
or before May 4, 2016, subject to receipt of all applicable regulatory and stock
exchange approvals and the satisfaction of certain other conditions to closing.

The properties
will be subject to a royalty equal (in total) to 3.125% of the value of the
recovered U3O8from the Properties sold at a uranium price
of $65.00 or less per pound U3O8, 6.25% of the value of
the recovered U3O8 from the Properties sold at a uranium price greater than
$65.00 and up to and including $95.00 per pound U3O8, and
7.5% of the value of the recovered U3O8 from the
Properties sold at a uranium price greater than $95.00 per pound
U3O8.

Letter of intent to acquire 40% of Roca Honda

On March 4, 2016, the Company entered into a non-binding letter
of intent (Letter of Intent) with Sumitomo Corporation to acquire its 40%
interest in the Roca Honda Project, for: (i) 1.0 million in cash; (ii) a number
of common shares of the Company equal to $1.5 million; (iii) once commercial
mineral extracting first commence at the Roca Honda Project, an additional $4.5
million in cash payable at that time. Closing of the acquisition is expected to
occur in April 2016 and is conditional upon final Sumitomo approvals,
negotiation and execution of definitive agreements and receipts of regulatory
and stock exchange approvals.

Public offering

On March 14, 2016, the Company completed a public offering (the
"Offering") of units of the Company (the "Units"), with each Unit comprising one common share of the Company (each, a Share) and one-half of one common
share purchase warrant (each, a "Warrant"). A total of 5,031,250 Units were sold
pursuant to the Offering at a price of $2.40 per Unit. The Company received net
proceeds, after commissions, of $11.35 million. Each Warrant is exercisable
for three years from March 14, 2016 and  entitles the holder thereof to
acquire one Share at an exercise price of $3.20 per Share.

F-32

---

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE

None

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Annual Report on
Form 10-K, an evaluation was carried out under the supervision of and with the
participation of the Companys management, including the Chief Executive Officer
(CEO) and Chief Financial Officer (CFO), of the effectiveness
of the design and operation of the Companys disclosure controls and procedures
(as defined in Rule 13a  15(e) and Rule 15d  15(e) under the Exchange Act).
Based on that evaluation, the CEO and the CFO have concluded that as of the end
of the period covered by this Annual Report on Form 10-K, the Companys
disclosure controls and procedures were effective in ensuring that: (i)
information required to be disclosed by the Company in reports that it files or
submits to the SEC under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in applicable rules and forms; and
(ii) material information required to be disclosed in its reports filed under
the Exchange Act is accumulated and communicated to its management, including
its CEO and CFO, as appropriate, to allow for accurate and timely decisions
regarding required disclosure.

The Company is in process of integrating Uranerz (which was
acquired on June 18, 2015) into its internal controls and procedures. As a
result, managements evaluation of disclosure controls and procedures did not
include an evaluation of the internal controls of Uranerz. The Company expects
to complete the integration by March 31, 2016. The financial results of Uranerz
are included in the financial statements from June 18, 2015 through and at
December 31, 2015. Uranerz total assets and total revenue represent
approximately 21% and 40%, respectively, of the total assets and revenue of the
Company for the year ended December 31, 2015.

It should be noted that while the CEO and CFO believe that the
Companys disclosure controls and procedures provide a reasonable level of
assurance that they are effective, they do not expect that the Companys
disclosure controls and procedures or internal control over financial reporting
will prevent all errors and fraud. A control system, no matter how well
conceived or operated, can provide only reasonable, not absolute, assurance that
the objectives of the control system are met.

Managements Report on Internal Control Over Financial
Reporting

Management is responsible for establishing and maintaining
adequate internal control over financial reporting, as defined in Rule 13a-15(f)
under the Exchange Act. The Companys management has employed a framework
consistent with Exchange Act Rule 13a-15(c), to evaluate the Companys internal
control over financial reporting described below. A companys internal control
over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles.

A companys internal control over financial reporting includes
those policies and procedures that: (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that
receipts and expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (iii) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the Companys assets that could have a
material effect on the financial statements. It should be noted that a control
system, no matter how well conceived or operated, can only provide reasonable
assurance, not absolute assurance, that the objectives of the control system are
met. Also, projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with policies and procedures may
deteriorate.

The senior executive officers, including the Companys CEO and
CFO, conducted an evaluation of the effectiveness, design and operation of the
Companys internal control over financial reporting as of December 31, 2015, based on the criteria established in Internal Control
 Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission 2013 framework. This evaluation included review of
the documentation of controls, evaluation of the design effectiveness of
controls, testing of the operating effectiveness of controls and a conclusion on
this evaluation. As discussed above, the evaluation did not include the acquired
operations of Uranerz. Based on this evaluation, management has concluded that
the Companys internal control over financial reporting, except for those
related to Uranerz, was effective as of December 31, 2015 and no material
weaknesses were discovered.

126

---

It should be noted that while the Companys CEO and CFO believe
that the Companys internal controls over financial reporting provide a
reasonable level of assurance that they are effective, they do not expect that
the Corporations internal controls over financial reporting will prevent all
errors and fraud.

Attestation Report of the Registered Public Accounting
Firm

This Annual Report on Form 10-K does not include an attestation
report of the Companys registered independent public accounting firm regarding
internal control over financial reporting. Managements report was not subject
to attestation by the Companys registered independent public accounting firm as
the Company qualifies as an emerging growth company under the Jumpstart Our
Business Start-ups Act of 2012.

Changes in Internal Control Over Financial Reporting

During the quarter ended December 31, 2015, 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.

ITEM 9B. OTHER INFORMATION.

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE

Information relating to this item will be included in the proxy
statement for our 2016 Annual Meeting of Shareholders and is incorporated by
reference in this report.

ITEM 11. EXECUTIVE COMPENSATION

Information relating to this item will be included in the proxy
statement for our 2016 Annual Meeting of Shareholders and is incorporated by
reference in this report.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Information relating to this item will be included in the proxy
statement for our 2016 Annual Meeting of Shareholders and is incorporated by
reference in this report.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND
DIRECTOR INDEPENDENCE

Information relating to this item will be included in the proxy
statement for our 2016 Annual Meeting of Shareholders and is incorporated by
reference in this report.

127

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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information relating to this item will be included in the proxy
statement for our 2016 Annual Meeting of Shareholders and is incorporated by
reference in this report.

128

---

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

Documents Filed as Part of This Report.

(1) Financial Statements

| | Report of
      Independent Registered Public Accounting Firm                                                            
| | -------------------------------------------------------------------------------------------------------------------------
| | Consolidated
      Balance Sheets at December 31, 2015 and 2014                                                          
| | Consolidated
      Statements of Operations Comprehensive Loss for the years ended December
      31, 2015, 2014 and 2013
| | Consolidated
      Statements of Operations Comprehensive Loss for the years ended December
    31, 2015, 2014 and 2013  
| | Consolidated
      Statements of Changes in Equity                                                                       
| | Consolidated
      Statements of Cash Flows for the years ended December 31, 2015, 2014, and
      2013                  
| | Notes
      to the Consolidated Financial Statements                                                                     

(2) Financial Statement Schedules

Schedules are omitted and are not applicable or not required,
or the required information is shown in the financial statements or notes
thereto.

(3) Exhibits

Where an exhibit is filed by incorporation by reference to a
previously filed registration statement or report, such registration statement
or report is identified in parentheses.

|Exhibit No. | Document Description                                                                                                                                                                                              
|----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|            |                                                                                                                                                                                                                   
|2.1         | Agreement and Plan of Merger by and among Uranerz Energy
      Corporation, Energy Fuels, Inc. and EFR Nevada Corp., dated January 4,
      2015 (1)                                                              
|            |                                                                                                                                                                                                                   
|2.2         | Amendment to the Agreement and Plan of Merger, dated May
      8, 2015 (1)                                                                                                                                        
|            |                                                                                                                                                                                                                   
|2.3         | Membership Interest Purchase Agreement by and among
      Energy Fuels Inc., Energy Fuels Holdings Corp., Mesteña LLC, Jones Ranch
      Minerals Unproven, Ltd. And Mesteña Unproven Ltd. dated March 4, 2016 (2)
|            |                                                                                                                                                                                                                   
|3.1         | Articles of Continuance dated September 2, 2005 (3)                                                                                                                                                               
|            |                                                                                                                                                                                                                   
|3.2         | Articles of Amendment dated May 26, 2006 (4)                                                                                                                                                                      
|            |                                                                                                                                                                                                                   
|3.3         | Bylaws (5)                                                                                                                                                                                                        
|            |                                                                                                                                                                                                                   
|4.1         | The Convertible Debenture Indenture dated July 24, 2012
      between Energy Fuels Inc. and BNY Trust Company of Canada providing for
      the issuance of debentures (6)                                        
|            |                                                                                                                                                                                                                   
|4.2         | Financing Agreement between Uranerz Energy Corporation and
  Johnson County dated November 26, 2013 (7)                                                                                                           
|            |                                                                                                                                                                                                                   
|4.3         | Bond Purchase Agreement among the State of Wyoming,
  Johnson County and Uranerz Energy Corporation dated November 12, 2013 (8)                                                                                   
|            |                                                                                                                                                                                                                   
|4.4         | Promissory Note dated November 26, 2013 (9)                                                                                                                                                                       

129

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|4.5   | Mortgage and Security Agreement and Assignment between
      Uranerz Energy Corporation and the Trustee dated November 26, 2013
(10)                         
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                              
|4.6   | Shareholder Rights Plan (11)                                                                                                                                 
|      |                                                                                                                                                              
|4.7   | Warrant Indenture between Energy Fuels Inc. and CST Trust
      Co. providing for the issue of common share purchase warrants dated March
      14, 2016 (12)
|      |                                                                                                                                                              
|10.1  | Energy Fuels 2013 Amended and Restated Stock Option Plan
      (13)                                                                                          
|      |                                                                                                                                                              
|10.2  | Energy Fuels Omnibus Compensation Plan (14)                                                                                                                  
|      |                                                                                                                                                              
|10.3  | Sales Agreement between Energy Fuels Inc. and Cantor
      Fitzgerald & Co. dated September 29, 2015 (15)                                                    
|      |                                                                                                                                                              
|10.4  | Form of Indemnity Agreement between Energy Fuels and its
  officers and directors                                                                            
|      |                                                                                                                                                              
|10.5  | Employment Agreement between Energy Fuels Inc. and
  Stephen P. Antony effective October 1, 2015                                                             
|      |                                                                                                                                                              
|10.6  | Employment Agreement between Energy Fuels Inc. and David
      C. Frydenlund dated March 11, 2016                                                            
|      |                                                                                                                                                              
|10.7  | Employment Agreement between Energy Fuels Inc. and W.
      Paul Goranson dated March 11, 2016                                                               
|      |                                                                                                                                                              
|10.8  | Employment Agreement between Energy Fuels Inc. and Harold
      R. Roberts dated March 11, 2016                                                              
|      |                                                                                                                                                              
|10.9  | Employment Agreement between Energy Fuels Inc. and Daniel
      G. Zang Dated March 11, 2016                                                                 
|      |                                                                                                                                                              
|10.10 | Underwriting Agreement dated March 9, 2016 (16)                                                                                                              
|      |                                                                                                                                                              
|21.1  | Subsidiaries of the Registrant                                                                                                                               
|      |                                                                                                                                                              
|23.1  | Consent of KPMG LLP, Independent Registered Public
      Accountants                                                                                         
|      |                                                                                                                                                              
|23.2  | Consent of Roscoe Postle Associates Inc.                                                                                                                     
|      |                                                                                                                                                              
|23.3  | Consent of William E. Roscoe                                                                                                                                 
|      |                                                                                                                                                              
|23.4  | Consent of Douglas T. Underhill                                                                                                                              
|      |                                                                                                                                                              
|23.5  | Consent of Thomas C. Pool                                                                                                                                    
|      |                                                                                                                                                              
|23.6  | Consent of Barton G. Stone                                                                                                                                   
|      |                                                                                                                                                              
|23.7  | Consent of Robert Michaud                                                                                                                                    
|      |                                                                                                                                                              
|23.8  | Consent of Stuart E. Collins                                                                                                                                 
|      |                                                                                                                                                              
|23.9  | Consent of Mark B. Mathisen                                                                                                                                  
|      |                                                                                                                                                              
|23.10 | Consent of Harold R. Roberts                                                                                                                                 
|      |                                                                                                                                                              
|23.11 | Consent of David A. Ross                                                                                                                                     

130

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|23.12 | Consent of Peters Geosciences                                                                                                                                                                       
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                     
|23.13 | Consent of Douglas C. Peters                                                                                                                                                                        
|      |                                                                                                                                                                                                     
|23.14 | Consent of BRS Inc.                                                                                                                                                                                 
|      |                                                                                                                                                                                                     
|23.15 | Consent of Douglas L. Beahm                                                                                                                                                                         
|      |                                                                                                                                                                                                     
|23.16 | Consent of W. Paul Goranson                                                                                                                                                                         
|      |                                                                                                                                                                                                     
|23.17 | Consent of Douglass Graves                                                                                                                                                                          
|      |                                                                                                                                                                                                     
|23.18 | Consent of Richard White                                                                                                                                                                            
|      |                                                                                                                                                                                                     
|23.19 | Consent of Don R. Woody                                                                                                                                                                             
|      |                                                                                                                                                                                                     
|23.20 | Consent of Terrence P. McNulty                                                                                                                                                                      
|      |                                                                                                                                                                                                     
|23.21 | Consent of Chlumsky, Armbrust and Meyer                                                                                                                                                             
|      |                                                                                                                                                                                                     
|23.22 | Consent of T.P. McNulty & Associates Inc.                                                                                                                                                           
|      |                                                                                                                                                                                                     
|23.23 | Consent of Geoffrey S. Carter                                                                                                                                                                       
|      |                                                                                                                                                                                                     
|23.24 | Consent of Broad Oak Associates                                                                                                                                                                     
|      |                                                                                                                                                                                                     
|23.25 | Consent of Trec, Inc.                                                                                                                                                                               
|      |                                                                                                                                                                                                     
|23.26 | Consent of Woody Enterprises                                                                                                                                                                        
|      |                                                                                                                                                                                                     
|23.27 | Consent of Allan Moran                                                                                                                                                                              
|      |                                                                                                                                                                                                     
|23.28 | Consent of Frank A. Daviess                                                                                                                                                                         
|      |                                                                                                                                                                                                     
|23.29 | Consent of SRK Consulting
      (U.S.) INC.                                                                                                                                                         
|      |                                                                                                                                                                                                     
|23.30 | Consent of Christopher Moreton                                                                                                                                                                      
|      |                                                                                                                                                                                                     
|23.31 | Consent of Richard L. Nielsen                                                                                                                                                                       
|      |                                                                                                                                                                                                     
|23.32 | Consent of Robert L. Sandefur                                                                                                                                                                       
|      |                                                                                                                                                                                                     
|23.33 | Consent of Matthew P. Reilly                                                                                                                                                                        
|      |                                                                                                                                                                                                     
|31.1  | Certification of Chief Executive Officer pursuant to Rule
      13a-14(a) of the Exchange Act                                                                                                       
|      |                                                                                                                                                                                                     
|31.2  | Certification of Chief Financial Officer pursuant to Rule
      13a-14(a) of the Exchange Act                                                                                                       
|      |                                                                                                                                                                                                     
|32.1  | Certification of Chief Executive Officer pursuant to Rule
      13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
2002

131

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|32.2 | Certification of Chief Financial Officer pursuant to Rule
      13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                   
|95.1 | Mine Safety
      Disclosure                                                                                                                                                                      

|(1)  | Incorporated by reference to Schedule B of Exhibit 99.1
      of Energy Fuels Form 6-K filed with the SEC on May 26, 2015.                                         
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2)  | Incorporated by reference to Exhibit 10.1 of Energy
      Fuels Form 8-K filed with the SEC on March 8, 2016.                                                      
|(3)  | Incorporated by reference to Exhibit 3.1 of Energy Fuels
      Form F-4 filed with the SEC on May 8, 2015.                                                         
|(4)  | Incorporated by reference to Exhibit 3.2 of Energy Fuels
      Form F-4 filed with the SEC on May 8, 2015.                                                         
|(5)  | Incorporated by reference to Exhibit 3.3 of Energy Fuels
      Form F-4 filed with the SEC on May 8, 2015.                                                         
|(6)  | Incorporated by reference to Exhibit 99.66 to Energy
      Fuels registration statement on Form 40-F filed with the SEC on November
      15, 2013.                
|(7)  | Incorporated by reference to Exhibit 4.1 to the Form 8-K
      filed on December 3, 2013 by Uranerz Energy Corporation.                                             
|(8)  | Incorporated by reference to Exhibit 4.2 to the Form 8-K
      filed on December 3, 2013 by Uranerz Energy Corporation.                                             
|(9)  | Incorporated by reference to Exhibit 4.3 to the Form 8-K
      filed on December 3, 2013 by Uranerz Energy Corporation.                                             
|(10) | Incorporated by reference to Exhibit 4.4 to the Form 8-K
      filed on December 3, 2013 by Uranerz Energy Corporation.                                             
|(11) | Incorporated by reference to Exhibit 10.9 to Energy
      Fuels Form F-4 filed on May 8, 2015.                                                                     
|(12) | Incorporated by reference to Exhibit 4.1 to Energy Fuels
      Form 8-K filed on March 14, 2016.                                                                   
|(13) | Incorporated by reference from Schedule B of Exhibit
      99.84 of Energy Fuels' registration statement on Form 40-F filed with the
      SEC on November 15, 2013.
|(14) | Incorporated by reference to Exhibit 4.1 to Energy Fuels
      Form S-8 filed on June 24, 2015.                                                                    
|(15) | Incorporated by reference to Exhibit 99.1 to Energy
      Fuels Form 6-K filed on September 29, 2015.                                                              
|(16) | Incorporated by reference to Exhibit 10.1 to Energy
      Fuels Form 8-K filed March 10, 2016.                                                                     

132

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

ENERGY FUELS INC.

|By: | /s/ Stephen P. Antony                            | 
|--- | ------------------------------------------------ | 
|    | Stephen P. Antony, Chief
      Executive Officer | 
|    | Principal Executive Officer                      | 
|    | Date: March 15, 2016                             | 

In accordance with the Securities Exchange Act, this report has
been signed below by the following persons on behalf of the registrant and in
the capacities and on the dates indicated.

|Per: | /s/ Stephen P. Antony                            | 
|---- | ------------------------------------------------ | 
|     | Stephen P. Antony, Chief
      Executive Officer | 
|     | (Principal Executive Officer) and
      Director | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|Per: | /s/ Daniel G. Zang                               | 
|     | Daniel G. Zang, Chief Financial
      Officer    | 
|     | (Principal Financial Officer and
      Principal | 
|     | Accounting Officer)                              | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|Per: | /s/ Glenn Catchpole                              | 
|     | Glenn Catchpole, Director                        | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|Per: | /s/ Dennis Higgs                                 | 
|     | Dennis Higgs, Director                           | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|Per: | /s/ J. Birks Bovaird                             | 
|     | J. Birks Bovaird, Director                       | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|Per: | /s/ Bruce D. Hansen                              | 
|     | Bruce D. Hansen, Director                        | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|Per: |                                                  | 
|     | Ames Brown, Director                             | 
|     | Date:                                            | 
|     |                                                  | 
|Per: | /s/ Hyung Mun Bae                                | 
|     | Hyung Mun Bae, Director                          | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|     | /s/ Ron F. Hochstein                             | 
|Per: | Ron F. Hochstein, Director                       | 
|     | Date: March 15, 2016                             | 
|     |                                                  | 
|     | /s/ Paul A. Carroll                              | 
|Per: | Paul A. Carroll, Director                        | 
|     | Date: March 15, 2016                             | 

133

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