WH Ireland Limited, 11 St James’s Square, Manchester, M2 6WH

WH Ireland is authorised and regulated by The Financial Conduct Authority and is a member of The London Stock Exchange. Important disclosures and certifications regarding companies that are the subject of this report can be found within the disclosures page at the end of this document.

URU Metals* # Initiation of Coverage

We today initiate our coverage of URU Metals (AIM: “URU”). URU has a series of exploration properties spanning a wide range of com modities across several countries, with a principal short-term focus on gol d, uranium and nickel. Fieldwork in 2013 will take place on the Nueltin project in C anada where URU is earning a 51% stake from Cameco (TSX: “CCO”) – this largely forgott en project has had several interesting drill intercepts including 9g/t over 6. 0m and 0.22% U 3O8 over 2.3m (not true thickness). URU will focus on understanding t he style and extent of any mineralisation on several pre-existing targets. In Sweden, URU is evaluating the oil-uranium potential of its new Narke licences in the Alum Shale. In Africa, URU has two projects – Uranium exploration in Niger (curren tly on hold) and the large Zebediela nickel project in South Africa (currently awaiting the results of an arbitration decision between two partners). All pr ojects have the potential to drive value in URU with the focus in 2013 on Nueltin in C anada. We initiate with a Speculative Buy recommendation and a share price tar get of 4.5p.

URU has four exploration projects in four countries with a spread of commodity and geopolitical risk . In the short term, URU will concentrate drilling efforts on its Nueltin Project (gold-uranium) in Canada (URU earning a 51% interest currently) and early reconnaissance work on the Narke Project in Sweden (uranium-oil) where URU has a 100% stake. While there has been some success in delineating prospective targets for sandstone-hosted uranium mineralisation in URU’s li cences in Niger , the projects are currently on hold. We feel that URU might try and Joint Venture these projects (URU owns 100%) with one of the operating companies in Niger to advance the projects while keeping a stake. The security situation in Niger is not improving and is unlikely to improve over the short term. A binding arbitration process is taking place on th e Zebediela project in South Africa between URU’s partners – URU is insulated from the process. If the court finds in favour of the status quo then URU will retain its 33% stake, otherwise it will have the money it has spent returned to it – money it could then use on its other projects. The deposit is a large, low-grade nickel deposit upon which a Preliminary Economic Assessment has been completed. The project has the potential to be a large produce r of nickel concentrate from the defined sulphide res ource. A 25 year mine-life from the Indicated Resource (JORC compliant) has shown i t is possible to produce up to 25kt/yr Ni at a low operating cost . The capital component of a project this size is likely beyond a small company like URU and its partners, but they have options; either selling it on to a major company or getting in a large stakeholder. Both options would be of significant value to URU and we do not include any of the potential upside from Zebediela in our valuation at the present time. We initiate today with a Speculative Buy recommendation and a risked target p rice of 4.5p. There is significant latent value in URU which has yet to be fully factored into the share price. Short-term drivers for the share price are the summer field season at Nueltin in Canada, and a result of the arbitration process over the Zebediela project in South Africa. Over the medium term we expect news from Niger and Sweden to drive further significant increases in value.

Speculative Buy Price 2.1p

Target Price 4.5p

Reuters/BBG URU.L / URU LN

Index FTSE AIM Sector Mining Market Cap £2.8m Shares in Issue 132.8m NAV Gearing NA Interest Cover NA

Performance All-Share Sector

1 month: -5.3% 0.9% 3 months: -24.0% -11.2% 12 months: -62.2% -48.0%

High/Low 5.5p / 1.8p

Last Results Dec 2012: Interims

Next Results Sep 2013: Annual Results

Next Event Start of field season at Nueltin

1223344556

Jun-

12

Jul-1

2

Aug

-12

Sep

-12

Oct

-12

Nov

-12

Dec

-12

Jan-

13

Feb

-13

Mar

-13

Apr

-13

May

-13

Source: CapitalIQ

Analyst Paul Smith+44 (0)113 394 6609

paul.smith@wh-ireland.co.uk *WH Ireland acts as Broker and Nomad to this company Marketing Communication This document has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Please refer to important disclosures towards the end of this document.

24 June 2013 UK EQUITY RESEARCH

MINING

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Contents Page Investment Case 3 Valuation 5 Upside Potential 5 Risk 8 Commodity and Exchange Rate Risk 8 Country and Political Risk 8 Title and Permitting Risk 8 Technological Risk 8 Company Overview 9 URU Asset Description 9 Nueltin – Canada (URU earning an interest) 9 Location and Geology 10 Previous work 10 URU Exploration 11 Narke – Sweden (URU 100%) 12 Location and Geology 12 Previous work 12 URU Exploration 12 Southern African Nickel – South Africa (URU 50%) 13 Location and Geology 13 Previous work 14 URU Exploration and Preliminary Economic Assessment (PEA) 14 Niger Uranium Exploration (100%) 16 Location and Geology 16 Commodity Overviews 17 Gold 17 Uranium 19 Nickel 20 URU Management 21 Canada Overview 22 Sweden Overview 22 South Africa Overview 23 Niger Overview 24

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Investment Case • Diversification – commodity and geography • Attractive exploration assets in safe jurisdictions ; Canada and Sweden • Large nickel project in South Africa • Exploration upside in Niger • Small, lean management group • Cash to advance its projects and a supportive major shareholder • We initiative with a Speculative Buy recommendation with a share price target

of 4.5p URU has a wide range of commodities in its exploration portfolio in several different countries thereby spreading its risk. In 2013, URU has announced two new projects, both early-stage but in very stable mining-friendly countries in Canada and Sweden. • Nueltin Project – gold-uranium project in Canada . Early stage, but with significant

upside potential • Narke Project – Multi-commodity prospect in the Swedish Alum Shales.

Hydrocarbon opportunity plus the potential to produce uranium, nickel, molybdenum and vanadium by-products. A process technologically play.

• SAN Nickel – very large, but low-grade nickel deposit in South Africa . Currently on hold as in a process of binding arbitration between BEE partners. URU is insulated from the process which post-dates its involvement.

• Niger Uranium Projects – Obvious potential discovered, and close to Niger’s operating uranium mines, but on hold as URU concentrates on projects elsewhere. Niger’s security situation is a concern.

URU’s most advanced project is the South African Nic kel project (SAN) at Zebediela , with another project at Burgersfort. URU’s involvement in the projects is currently on hold as binding arbitration takes place between its two partners, one of which is a Black Empowerment (BEE) partner. The dispute postdates URU’s involvement with the projects and as such URU is insulated from the dispute. The binary outcome will provide URU either with:

• Either a 33% holding in Zebediela (as it has) now if the arbitrator sides with SAN • Or its total expenditure in the Zebediela project back – currently standing at

US$3.3 million – if the court rules in Umnex’s favour and Umnex buy 100% of the Zebediela project from SAN.

Timing is uncertain on the outcome of arbitration, but there will be an outcome. Until this time URU have parked the project. The potential for the project is large , but it is likely beyond the reach of a smaller company, like URU, to take the project much further without a major partner. We believe that there are companies who would be interested in taking a stake in the project and who would have the financial firepower to take the project forward. Using the CEO’s connection with Cameco to good effect, URU gained access to the Nueltin project. This project was drilled by Cameco in 2008 where several drill holes tested an Induced Polarisation (IP) anomaly coincident with a series of mineralised boulders. The drill holes intersected a replacement-style min eralisation of uranium and gold with some quite high intersections of both . During and after the GFC Cameco used its exploration funds for more strategic projects and made Nueltin available for options from third parties. URU are now earning a 51% stake (with potential for more) in the project and have planned a C$0.7 million exploration program for summer 2013. This project has, in our view, a good chance of outlining a mineralised body with continuity in a largely unexplored area. Summer and Autumn 2013 will be a key period for URU and its shareholders. The other new project announced by URU is a 100% interest in Svenska Skifferoljeaktiebolaget which owns six mineral exploration licences in Narke Province in Sweden over prospective Alum Shales. This is a new move into a poly-commodity

Range of commodities and geopolitical regions: Canada – gold-uranium Sweden – uranium-oil Niger – uranium South Africa - nickel

Nickel project in South Africa is URUs most advanced project, but subject to an arbitration process between partners – URU relatively insulated from the outcome

The potential at Zebediela is large, but capital cost likely to be beyond URU and its partners.

Excellent opportunity at Nueltin – URU earning an option from Cameco on a gold-uranium mineralisation with, in our opinion, significant potential

New project in the Alum Shales in Sweden. Early-stage

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exploration play involving uranium, hydrocarbons an d other metals . Other companies are also looking into this emerging district, which has produced oil, uranium and vanadium in the recent past, because as some countries become too risky to explore or operate in, or as companies wish to spread their uranium production risk, deposits in the Alum shale will become an important part of an exploration portfolio. One example of this is Areva, one of the worlds pre-eminent uranium companies, who are now in partnership with Aura Energy (ASX: “AEE”) and will fund the Pre-Feasibility Study on the Häggån project in the Alum Shales of Sweden. This project, like URUs project contains potentially large tonnages of metals. To put a scale on the project, Aura has defined an Inferred Resource at Häggån of 803Mlbs of U3O8 within 2.35Bn tonnes @ 155 ppm U3O8, with the presence of significant tonnages of nickel, zinc and molybdenum to produce an equivalent grade of between 250-300ppm U3O8; a large and globally significant resource. These are potentially large producers of uranium and will require a senior partner and an ability to raise a considerable amount of debt funding, should a mine be justified. At Narke we anticipate that URU will quietly determine what potential it has and to research a workable process route to treat the complex ores before negotiating to bring in a senior partner. Exploration in Niger is currently on hold. A deteriorating security situation, exacerbated in May 2013 by Islamist attacks on an Areva-owned mine, together with its borders with Mali and Algeria make the area unpredictable and high risk to operate and invest in. URUs exploration in Niger has been successful and has fo und some very good drill projects with prospective geology which contain hig h levels of uranium. There is some real value in URUs licences in Niger that could be realised once the security situation calms down. A common criticism of AIM-listed exploration companies is that not enough money is spent in the ground. We point to URU as an example of how exploration can be done to maximise dollars into projects. The board is small and experience high. Executives are Canadian-based and this seems perfect for the short-term focus on the Nueltin gold-uranium project. URU has cash in hand to advance its projects over t he course of 2013 and into 2014 and can already demonstrate significant progress to its shareholders as it spreads commodity and geopolitical risk into new projects. Its major shareholder is Niketo Company Limited (100%-owned subsidiary of NWT Uranium) with a 37.49% holding. We initiate with a Speculative Buy recommendation and a target price of 4.5p derived as part of a sum of the parts (SOTP) valuation. The company has a good mix of assets and spread of commodity and geopolitical risk. Value can be seen in the large nickel deposit in South Africa (Zebediela Project), with significant potential in Canada for gold-uranium (Nueltin Project) with some prospective and interesting licences in Sweden and Niger. Following a summer field season in Canada at the Nueltin project we expect news flow to drive the share price in the short-term. O ver the medium-term we expect to see the legal process in South Africa resolved and a n increase in valuation recognised in the Zebediela project .

Companies looking to spread risk in uranium production could well consider the Alum Shales – potentially capital intensive and technologically challenging, but a great jurisdiction for mining. Supportive laws and government plus a highly skilled workforce

We see Niger as a non core area for URU. Security situation not ideal and URU may well choose to JV its properties – after developing some very good drill targets. We believe URU may well have a choice of partners.

URU has cash to advance its Nueltin project and complete early reconnaissance over the Narke licence. URU has the potential to advance understanding of these projects and drive the share price. Catalysts for a short-term increase in share price: Successful field season at Nueltin and a result in the SAN arbitration. We initiate with a Speculative Buy recommendation and a 4.5p price target

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Valuation We have valued URU Metals using a sum-of-the-parts methodology for each of its projects to arrive at a total for URU. To get a value for the exploration licences we use a comparable transaction methodology – what would it cost to gain access to the licences. We have risked the Niger licences on the basis of the security situation.. In the case of the SAN JV (Zebediela project) we have valued the project at the amount of money that URU would receive if the arbitration went in favour of UMNEX; a return of the capital spent by URU on the project. We currently ascribe no value to the Burgersfort project, also in South Africa, pending the result of the binding arbitration on Zebediela. We initiate with a Speculative Buy recommendation with a risked 4.5p/sh are price target . The valuation is set out below in table 1 Table 1 URU Metals – Risked Valuation Summary Asset Value – US$m Risk Value - £m* GBp/share** Nueltin 2.0 1.0x 1.3 1.0 Narke 1.5 1.0x 1.0 0.7 SAN (Zebedelia) 3.3 1.0x 2.1 1.6 Niger Uranium 1.0 0.5x 0.3 0.2 Cash, Cash-equivalent*** 2.0 1.0x 1.3 1.0 URU Metals 9.8 6.0 4.5 Source: WH Ireland Research * US$: £ - 1.55:1 ** 132.8 million shares(post placing) *** WH Ireland Estimate

Upside Potential The obvious short-term upside for our valuation would be if URU were to have a successful field season at Nueltin in Canada. As URU’s primary exploration focus in 2013 this project will be key to the valuation by the end of the year. It is unlikely that a resource could be calculated from work done during 2013, but a series of good drill hole intersections could help drive value in what could be a company-making project. Previous drilling has demonstrated the potential for high-grades, of gold and uranium, over wide-zones and we look forward to the first new drill results of 2013 with interest. A second driver for an increase in our valuation would be the outcome of the arbitration on the SAN project at Zebediela. We have valued the Zebediela project at the worst case for our current valuation – the return value of the money URU has spent – US$3.3 million, as part of the binding arbitration process. However, if URU retains its share of the project after arbitration and can maintain a significant ownership once a major partner has been identified then our valuation could increase significantly. We have produced a basic cash flow (Table 3) for the operation using many of the parameters used in the Preliminary Economic Assessment (PEA), modified by some of our own assumptions – all set out in Table 2. The Zebediela project has much in common with the Dumont Nickel project currently being advanced by Royal Nickel Corporation in Canada - in terms of scale and nickel grade - minus the small contribution of cobalt. The cash flow (Table 3) provides an indicative valuation of the Zebediela project of US$111 million (32.5p/share); for URU’s 33% share of the project and including an element of risk . If a major partner came in with a 50% ownership of the whole project or a 75% ownership in the whole project then URU’s share would fall to US$56 million and US$28 million respectively (18.9p/share and 9.5p/share) – Table 4; All still significant uplifts on the current share price.

Valuation of 4.5/share based on a SOTP methodology.

We emphasize the upside potential in the SAN project – the Zebediela project is large scale and potentially rewarding

We value the risked potential of URUs share of Zebediela at US$111 million – or 32.5p/share. Bringing in a major partner and diluting URU would still leave plenty of value in the project for the company

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We currently include no credits for a magnetite concentrate – the ore contains up to 5% magnetite amongst other minerals. This could be relatively easily recovered using a standard magnetic circuit and could form an important by-product credit as an iron ore. We do not include any of this potential in our upside presented here.

Table 2: Assumptions for the Zebediela Cash Flow * 1.55:1 US$ : £ Exchange Rate 10 US$/t Average Mine Site Cost (Open Pit Mine, Mill and Onsite G&A)** 900 US$M Initial Capital Cost*** 15 US$M/yr Average Ongoing Sustaining Capital 10 % Corporate Tax Rate – 3-year tax holiday 30 % Nickel Realisation Cost as a percentage of price (Freight, TC & RC) 10 $/lb Nickel Price 26 years Indicated resources only**** Source: WH Ireland Research / URU Metals * Modified from the MSA PEA study completed in mid-2012 ** Mine Site cost constant in $/t terms. *** $35/t of annual capacity of Ni. Lower-end of current range for large, low-grade sulphide deposits ****No Inferred Resources used in model - These could add to mine life, or form part of an expansion

Table 3: Simplified Zebediela Cash Flow

Yr-3 Yr-2 Yr-1 Yr 1 Yr 2 Yr 3 Yr 4 Break

in Years

Yr 25 Yr 26

Ore Mined Mt 10 20 20 20 | 20 10 Waste Mined Mt 10 15 15 15 | Stripping Ratio # 1.0 0.8 0.8 0.8 | Ore Processed kt 10000 20000 20000 20000 | 20000 10000 Grade Ni Ni % 0.25 0.25 0.25 0.25 | 0.25 0.25 Ni recovery % 50.0 50.0 50.0 50.0 | 50.0 50.0 Ni in concentrate kt 12.5 25.0 25.0 25.0 | 25.0 12.5 Concentrate Grade Ni % 15.0 15.0 15.0 15.0 | 15.0 15.0 Ni Concentrate kt 83.3 166.7 166.7 166.7 | 166.7 83.3 Nickel Price $/lb 10.0 10.0 10.0 10.0 | 10.0 10.0 Gross Revenue US$M 275.6 551.2 551.2 551.2 | 551.2 275.6 Realisation Costs US$M (82.7) (165.3) (165.3) (165.3) | (165.3) (82.7) Net Revenue US$M 192.9 385.8 385.8 385.8 | 385.8 192.9 Mine Site Costs US$M (118.0) (222.0) (222.0) (222.0) | (180.0) (90.0) EBITDA US$M 74.9 163.8 163.8 163.8 | 205.8 102.9 depreciation US$M (39.6) (49.6) (49.6) (49.6) | (49.6) (49.6) EBIT US$M 35.3 114.2 114.2 114.2 | 156.2 53.3 Interest US$M 54.0 43.2 32.4 21.6 | Tax US$M (2.8) (9.1) (9.1) (9.1) | (12.5) (4.3) Expansion Capital US$M (150.0) (400.0) (300.0) (50.0) | Sustaining Capital US$M (5.0) (15.0) (15.0) (15.0) | (15.0) (15.0) Add Back in Depreciation US$M 39.6 49.6 49.6 49.6 | 49.6 49.6 CASH FLOW US$M (150.0) (400.0) (300.0) 71.1 182.9 172.1 161.3 | 178.3 83.6

Source: WH Ireland Research / URU Metals * Mine Site cost constant in $/t terms. **No Inferred Resources used in model - These could add to mine life, or form part of an expansion

Other upside at Zebediela is in the form of a magnetite concentrate and a by-product credit. We don’t include this option in our model

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The Zebediela project is obviously sensitive to the nickel price and both capital and operating costs. We have valued the project using a long-term nickel price of $10/lb. This is a conservative price with project incentive prices for nickel growing substantially over the past few years, driven by the large increases in capital cost and operating cost. Increasing the nickel price to $12/lb and $16/lb gives an increase in the Zebediela project NPV10% from US$337.4 million at US$10/lb Ni to US$800 million at US$12/lb Ni and US$1723 million at US$16/lb Ni. We calculate that the project breaks even at US$8.5/lb which is above the current price of US$6.4/lb; a price that is placing a significant amount of the industry under profit margin pressure and is clearly unsustainable over the medium- to longer-term. Current low prices are on the back of weak demand and a current balanced to surplus supply of nickel. We feel that the surplus will disappear in a few years and lead to higher, sustained prices with increasing demand. Table 4 URU Metals – Risked Valuation Summary – Zebed iela Upside Asset NPV 10% Risk Risked Value US$m #x US$m £m* p/share** Zebediela (100%) 337.4 Zebediela (URU 33%) 111.3 0.6x 66.8 43.1 32.5 Zebediela (URU 16.5%) 55.7 0.7x 39.0 25.1 18.9 Zebediela (URU 8.3%) 28.0 0.7x 19.6 12.6 9.5 Source: WH Ireland Research * US$: £ - 1.55:1 ** 132.7 million shares

Figure 1: Zebediela – Sensitivity to nickel price

Asset Ni Price NPV 10% $/lb US$bn Zebedelia (100%) 8 -0.1 10 0.3 12 0.8 14 1.3 16 1.7

-0.5

0.0

0.5

1.0

1.5

2.0

8 10 12 14 16Ni Price (US$/lb)

NP

V10

% (

US

$ bi

llion

)

Source: WH Ireland Research

We think it is too early to derive any upside potential for Narke or for Niger: In the case of Narke, URU has yet to outline a plan or timeline as it needs time to fully assess its options. We will say, however, that the hydrocarbon potential can not be ignored; the speed of technical developments in unconventional oils over the last decade (e.g. fracking, drilling techniques and oil sand processing – retorting and recovery) has been impressive, and the effect that this will have on oil and gas prices over the coming decade is as yet not fully understood. This potential, allied with the increasing demand for uranium over the coming years means that there could be some significant latent value in the Narke licences which URU can realise.

Even allowing for dilution form a major partner – allowing for an 8.3% share in the project if a major takes 75% of the whole leaves URU with 9.5/share Obvious sensitivity to the nickel price – we value the project using $10/lb. But a 20% increase in this to US$12/lb increases the project NPV from $0.3bn to $0.8bn. The nickel price could well move higher than this according to many market commentators

Narke – early stage and a technology dependent. Too early to imagine any upside from this project yet

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For Niger, while the geological potential is huge, the security situation is poor. We can not see a current end to the ongoing instability; the involvement of French forces while calming the situation is not providing a long-term solution. As the Niger projects are not currently a focus for URU they could be Joint Ventured, perhaps with one of the companies with ownership in operating mines in Niger: Areva, ONAREM, Japan's Overseas Uranium Resources Development Co (OURD), China Nuclear International Uranium Corporation (SinoU) or Korea Resources Corp (KORES). This would enable the projects to be advanced with URU still maintaining a stake and keeping some exposure to Niger.

Risk We are of the opinion that URU Metals represents a moderate-risk exploration company with potential upside. In this respect it is no different from its global exploration peers. URU does have a mixture of country risk, but in the short-term value could be driven by exploration in more stable countries, Canada and Sweden. Nonetheless, any investment in URU does have its own risks of which we highlight the following: Commodity price and exchange rate risk : Commodity prices are inherently cyclical. URU is principally exposed to the uranium price, the gold price and the nickel price; all of which we believe there is a good supply story for. • Uranium demand will increase. Supplies from existing producers are relatively stable

and demand from new reactors will grow. • The gold price is currently under pressure, but its value as a store of wealth is

undiminished and • Nickel demand will be maintained by the increase in stainless steel production, driven

by industrialisation and infrastructure projects in Asia.

In terms of exchange rate, URU is exposed to a mixture of currencies: US$, C$, £, Swedish Krona, South African Rand and the Central African Franc (CFA). At this stage we don’t see much currency risk for URU and note that current weakness in the South African Rand could have a positive impact on project economics. At this stage we have not included any benefit of this in our analysis. Country and political risk : URU has a range of geopolitical exposures. Canada and Sweden are low-risk countries for mining investments, while South Africa has moderate risk as growth stalls and the Rand deflates against the US$ against a backdrop of labour unrest. Niger is a higher-risk country again as Islamist groups try and increase their influence in Northern Africa. Short-term any increase in value is going to be driven by the Canadian and Swedish projects as URU put time and money into developing its knowledge. Title and permitting risk : Title and permitting risk is low in our opinion – all countries that URU has projects in have mining laws. There is a risk of resource nationalisation in Niger, and lesser so in South Africa. In Niger, should a mineral resource be defined the government will be able to take a 10% free-carried stake in the project, though the President (Mahamadou Issoufou) has recently announced he intends to try and renegotiate contracts with existing producers. Technological risk : Here we highlight the risk of developing a process route for the oil-uranium potential at Narke in Sweden. URU’s other projects will use conventional technology if they justify construction. Any development of the full potential at Narke will require a novel process route and one which will probably be capital intensive. Any large-scale development will require a major company to fund construction.

Niger potential is large, but for URU perhaps not its primary focus. The security situation and inherent risk for a junior is perhaps too high. We are of the opinion that URU could JV the properties to an operator in Niger and believe that URU would have a choice of partners if it wanted to go down this route

Commodity price and exchange rate risk is low. We have used conservative long-term prices in our model

Country and political risks for URU are variable. But the short term exploration programme will all be in stable and low-risk jurisdictions

Title and permitting risk also low

Technology risk generally low. We highlight Narke as having a higher risk

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Company Overview Figure 2 Location of URU’s Projects

Source: URU Metals

URU Metals changed its name from Niger Uranium Limited in March 2011 to reflect a change in strategy and business interests over a wider geography and range of metals under investigation. At this point URU gained a holding in the SAN nickel project in South Africa to compliment it’s uranium holdings in South America and Niger. In 2013 the project mix has changed once again with the new Nueltin gold-uranium project in Canada and the Narke Alum Shale project (hydrocarbons plus uranium, nickel, vanadium and molybdenum potential) added to URU’s portfolio plus the sale of its minority interest in Ur America.

URU Asset Description Nueltin – Canada (URU earning an initial 51% intere st) URU announced it had signed a JV with Cameco Corporation over the Nueltin project in Canada. URU has to fund C$2.5 million in exploration expenditure over a three-year period to earn 51% in the project after which time it can earn a further 19% of the project by spending an additional C$8 million over a further four years. URU is the operator while earning its option, after which time a standard JV agreement will be in place whereby both parties will contribute its share of expenditure. If a mine is developed, and Cameco retain a 20% interest in the project then it will get the option to purchase all of the uranium that is produced at the greater of 90% of the SPOT price or US$35/lb U3O8 if the price is lower than US$35/lb. Location and Geology Nueltin is in the Kivalliq regionj of Nunavut in Canada, 10km north of the border with Manitoba. The project consists of 34 mineral claims and one mineral lease. The area has been drilled and several uranium-gold zones found; perhaps the most interesting is the Sandybeach zone. The project is located in the Hearne Domain of the Churchill Province of the Canadian Shield. The Archaean basement rocks of the Hearne Craton are overlain by a PalaeoProterozoic meta-sedimentary sequence subdivided into two Groups: Hurwitz and Wollaston. The metamorphic grade increases to the SE from greenschist to granulite

URU’s exploration portfolio

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facies with partial melting and the formation of pegamatites and aplite segregations. Igneous intrusions in the area are of two types: pre-tectonic granitoids with post-tectonic coarse-grained biotite-granites some with rapakivi textures. The area has been glaciated with quaternary studies suggesting that ice flows were from the NNE to the SSW, which roughly matches the regional foliation. Till overlies much of the land in the area, up to 10m thick. A major thrust has been proposed running through the licence. A significant difference in metamorphic grade running through the licence area could explain the discontinuity in metamorphic grade and the increase in foliation in the Wollaston Group to the SE. The area has only limited exposure, so the current understanding is built up by a small amount of exposure mapping, boulder field composition, geophysics and drill core interpretation. At this early-stage of exploration there are two types of mineralisation under investigation in the area with the emphasis on the first: • Metasomatite uranium deposits – polymetallic zones of sulphide-rich uranium-gold

mineralisation in an albite-pyroxene zone. Typified by the Sanybeach zone. Gold is native with minor silver, while uranium is uraninite and coffinite as clusters associated with amphibole and pyroxene. The jury is out on how the mineralisation formed, though proto-stratigraphy is thought to be important.

• Uranium, thorium and Rare Earth Element (REE) mineralisation in late-stage felsic dykes associated with the Nueltin granite – formed during late-stage fractionation of the granite

Previous work Mineralisation was found in 2008 during a diamond drilling campaign by Cameco. The area had been identified during the 1960s and 1970s by aeromagnetic and radiometric surveys. Mineralised boulders were first found in 1987 in the Sandybeach area some of which contained high-grades of up to 2.6oz/st gold and 0.6% U3O8 with accompanying scheelite and the area was looked at by some of the larger Canadian mineral companies – Teck, Noranda and Inco.

Figure 3: Schematic through the Nueltin lake Mineral isation Drill Core Samples

Source: URU Metals

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Cameco became involved in 1998, but did little with the area until 2006 when, prompted by rising uranium prices, it carried out regional exploration over the area together with further airborne geophysics. This work led to a drill program in 2008 of 15 drill holes in the Sandybeach area where magnetic and IP/resistivity anomalies had been identified. 11 of the holes were drilled in the Sandybeach area with 4 holes as reconnaissance holes elsewhere in the licence. Only three holes were targeted at the IP anomaly and all three hit gold-uranium mineralisation with multiple intersections; the best intercept was 9g/t over 6.0m and 0.22% U3O8 over 1.25 (not true thickness). Limited follow-up was carried out in 2009, and a new IP survey carried out, with a new drill program proposed for 2010, but Cameco decided the area was not core to its exploration plan and the area made available for option to other parties.

URU Exploration URU has planned a 5-10 hole drill program (C$600-750k) for summer 2013 as part of its option to acquire an interest in the project from Cameco. The drill program will concentrate on drilling the IP targets around the area of mineralised boulders and also a new IP anomaly identified by Cameco during 2009. Keys drivers to the project: • Limited geological knowledge – project is early-stage with plenty of upside • Mineralisation has been identified in 3 holes on the IP anomaly – only 3 holes have

ever been drilled on the IP anomaly. The IP anomalies are related to the polymetallic sulphides (pyrite, pyyrhotite and arsenopyrite) which accompany gold and uranium.

• Mineralisation is open: o Strike length along the IP anomaly yet to be tested, plus additional IP

anomalies in the area o Only the top of this system has been looked at – drill holes are shallow o Substantial thicknesses of mineralisation already encountered

• Potentially more zones of mineralisation can be found in the area – Boulder tracing is a very successful technique in the glaciated Canadian boreal forest and Cameco located several more ‘trains’ to be followed up.

• The key will be to determine if the already intersections form a more extensive zone of mineralisation that could form the basis for a resource estimate

Figure 4: The Sandybeach Lake Area; part of the Nue ltin licences

Source: URU Metals

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URU METALS

Narke – Sweden (URU 100%) URU announced in May 2013 the acquisition of 100% of Svenska Skifferoljeaktiebolaget from Global Hydrocarbons Limited which owns six mineral exploration licences in Narke Province in Sweden. The transaction was for US$1.1 million consisting of US$0.3 million in cash and 17 million shares in URU (12.8% of the company). Location and Geology The six exploration licences are in Narke province in Sweden, which lies 150km west-south-west of Stockholm. These cover 7087ha of prospective Alum Shale outcrops known for its high levels of kerogen (hydrocarbon-bearing) and uranium, vanadium, molybdenum and nickel. The Alum Shale is black organic-rich shale 20-60m thick deposited during the Cambrian to Ordovician in basins over the Baltic Shield. In places it can reach thicknesses of 200m in repeated sequences due to thrust faulting. The shale has been used as a source of potassium aluminium sulphate for fixing colours during the dying of clothes since the early 1600s and its potential as a source of energy was recognised in the early 1800s. At Narke the oil-uranium bearing shale is 10.8m thick – tested in 37 boreholes with a 4-8% oil yield and a uranium grade averaging between 135 – 245ppm U3O8. A non-JORC estimate of the resource potential is 1.4billion tonnes of shale with 300t uranium and half a billion barrels of oil (5% yield). We stress these are non compliant resources, but just a guide of the geological potential of the licences. During and after World War II oil was produced from the shale but production ceased in 1966 as it was expensive to produce at the time. Production in Sweden was from Narke as well as another shale resource at Kinnekulle. Production over the period was 1 million barrels of petroleum and 2.6 million barrels of fuel oil. Its potential as a host for metals was also recognised with small amounts of vanadium produced during World War II and uranium produced sporadically immediately after the war and then more commercially at Ranstad which operated until 1989. At Ranstad a specific zone in the upper part of the sequence contains higher grades of U3O8. Overall Sweden produced 61 tonnes of uranium over the period (or 134.5Mlbs). Previous work Previous drilling in the licence has demonstrated a good thickness of Alum shale. URU Exploration URU will begin its work into potential processing routes before carrying out too much drilling. A co-recovery oil and metal extraction process will need to be developed from existing technologies before significant investment in resource definition. This is a technology play. URU are not alone in working in the Swedish Alum shales and there may be some opportunity to share technology. Perhaps one of the furthest advanced is the Häggån project which is 100% owned by Aura Energy and which has a co-operation agreement with Areva under which Areva may acquire an interest in the project.. Areva is 85% owned by the French State and is one of the worlds largest suppliers of uranium. Recent attacks on its operations in Niger has led Areva, and other major producing companies, to look at countries with a lower risk profile where uranium can be produced; perhaps at a higher cost, but with more security of supply. Sweden certainly fits the bill as a stable country and also one of the best countries in the world in which to mine. URU will be among the first companies in this stable, safe jurisdiction to develop a presence in the Alum Shales .

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URU METALS

Southern African Nickel Projects– South Africa (URU 33%) URU gained an interest in the nickel projects in 2010 by committing to spend US$3.6 million over 20 months to earn an interest. South African Nickel’s (SAN) most prospective projects are the Burgersfort and Zebediela nickel projects which have the potential to become large nickel mines; Zebediela is the most advanced and has a pre-feasibility study completed over it. URU has the project on hold at present as it awaits the results of binding arbitration in South Africa. There is a dispute between SAN and Umnex Mineral Holdings over progress in the project. The dispute postdates URU’s involvement with the projects and as such URU is insulated from the dispute. If the court sides with SAN then the project will continue as planned; if the court rules in Umnex’s favour then Umnex will have the opportunity to buy 100% of the Zebediela project from SAN – at this point URU would be able to recover all of the money it has invested in SAN which is currently US$3.3 million. Timing is uncertain on the outcome of arbitration.

Location and Geology The Zebediela nickel project is located in the Limpopo Province of South Africa close to the platinum mining town of Mokopane (formerly Potgietersrus). While Burgersfort is close to the town of Burgersfort in the Mpumalanga Province. The projects lie within the ultramafic Bushveld Complex, a layered igneous intrusion which intrudes the metasedimentary Transvaal Supergroup and Archaean basement. The Bushveld hosts the world’s biggest deposits of Platinum Group Metals (PGMs) as well as significant deposits of vanadium and chrome. Zebediela is located on the Northern limb of the complex while Burgersfort is on the Eastern limb (Figure 7)

Figure 5: Ownership Structure – URU has an effective 33% interest in Zebediela and 23% in Burgersfort

Source: URU Metals

Figure 6: Location of SAN projects in South Africa

Source: URU Metals

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The mineralisation style being investigated is a disseminated nickel mineralisation within an altered basic and ultrabasic sequence. There are currently no nickel mines in the Bushveld, but rather nickel is produced as a by-product from the PGM mineralisation which is generally hosted in specific horizons within the complex e.g. the Merensky reef, UG2 or Platreef. At Zebediela and Burgersfort nickel is disseminated over wide zones. Much of the nickel is in the serpentine, but from mineralogical studies at Zebediela it has been found that between 60-70% occurs as nickel sulphides (principally pentlandite) and this should be recoverable by standard flotation methods. The following information is principally on the Zebediela project as this is the most advanced. Figure 7: Location of SAN projects in South Africa in the Bushveld Complex

Source: URU Metals

Previous work – (Zebediela) Several companies began exploring in the 1970s searching principally for PGM mineralisation; unsuccessfully. Outcrops of nickeliferous gossans led to a soil geochemistry survey and an IP program over the Uitloop farm in 1972. A 7-hole drill program failed to find significant mineralisation. Work began again in 1998with minex and SouthernEra looking both for Platreef mineralisation and looking for the potential for a massive nickel sulphide deposit following the regional airborne EM survey – leading to an eventual farm-in by Falconbridge. The JV drilled 5 holes searching for massive nickel sulphides, followed by a further three holes; it was the first two of these final three holes (U1 and U2) which drilled 600m of ultramfic rock grading 0.26% Ni (U1) with U2, 2.5km away drilling similar thicknesses and grades which found the Uitloop deposit The SAN JV drilled a total of 16 holes into the main Uitloop deposit. Core recovery is high (over 98%), expect for the upper oxide zone (83%) URU Exploration and Preliminary Economic Assessment (PF A) The SAN JV drilled a total of 16 holes into the main Uitloop deposit. Core recovery is high (over 98%), expect for the upper oxide zone (83%). Results show that there is a continuous body stretching NW to SE for more than 3km with a surface width of 1km (Figure 8). The deposit is homogenous consisting predominantly of serpentinised

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URU METALS

harzburgite and an average grade of 0.26% nickel which is remarkably consistent. Importantly the body is open along strike and at depth. A PEA was completed in mid 2012 after extensive metallurgical test-work; the key to producing nickel from the large, but low-grade orebody. • Resource : PFS envisages recovery of the Indicated Resource of 485Mt of ore

grading 0.245%Ni below the oxide zone. An additional Inferred Resource of 1115Mt grading 0.248%Ni is not included and would form part of any additional upside.

• Mine : Open pit nearly all in ore. Stripping ratio of 0.4:1 Life-of-mine with all stripping done by year 12.

• Processing : Throughput of 20Mt/yr with a total nickel grade of 0.25%, of which 60-70% in the form of sulphide. Testwork has shown that a 15% nickel concentrate with a total of recovery of 50% nickel is possible (recovery of ~80% of the sulphide nickel). In addition perhaps 65% of the magnetite in the rock could also be recovered to a concentrate grading >65% iron; magnetite makes up ~5% of the resource.

• Infrastructure : There is access to transport and power links. Power requires an upgrade by Eskom as part of addressing South Africa’s wider power problems. Water is an issue and a source of water for the plant needs to be identified

• Capital Cost: Capital Cost of the 20Mt/yr ore project is estimated at greater than US$700 million.

• Operating Cost : US$9/t milled (Mining US$3.7/t, Processing US$4.8/t, G&A US$0.4/t and other US$0.2/t). This translates into a cost-to-concentrate per lb of nickel of 3.4/lb paid nickel.

Figure 8: The Uitloop Deposit

Source: URU Metals

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Niger Uranium Exploration (100%) URU has two licences in Niger: In Gall (Aboye project), Irhazer (Fagiochia and Azouza) and the Kamas and Dabala permits. Niger is the world’s fourth largest producer of primary uranium (2011 – 9.6Mlbs) and has the worlds eighth largest resources. URU’s licences are located between the Areva Imouraren Mine (500mlbs U3O8), SinoU’s Azelik mine (39 Mlbs U3O8) and Global Atomics Tin Negourane deposit (10Mlbs+ U3O8). Exploration in Niger is currently not URU’s priority as it concentrates on its Nueltin gold-uranium project in Canada. Recently uranium mining in Niger underwent an al-Qaida linked group attack on two French-owned uranium mines in northern Niger. Location and Geology URU has tested its licences for sandstone-hosted roll-front deposits, looking for a deposit containing 15Mlbs+ of uranium with a grade of 0.1% of U3O8. • Aboye (In Gall permit) : Since

2007 URU has defined an area of 3km x 1km where uranium grades in excess of 150ppm. 31 widely-spaced drill holes (>500m spacing). URU believes there is plenty of opportunity for a higher-grade zone within the area.

• Fagiochia and Azouza (Irhazer permit): Two less-well advanced projects with favourable geology and a drill hole with elevated levels of uranium. Same exploration methodology as that used to find Aboye.

• Dabala and Kamas Permits: located 46km north of Arlit where Areava mines uranium at its Arlit mine.

Mineralisation in Niger is epigenetic and hosted within sandstone. It forms when oxidised groundwater containing uranium comes into contact with a reduced environment below the water table often below an impermeable sediment such as a mudstone or shale. The mineralisation takes several forms: rollfront, tabular, palaeochannel or related to fault structures within the permeable / impermeable sediments. Mineralisation is commonly formed during late-stage diagenesis with the source of the uranium a weathering product from nearby granitoids. In Niger, uranium mineralisation is found in the Tim Mersoi basin sediments. Mineralisation is typically fine-grained uraninite (pitchblende) often replacing fossilized plant matter.

Figure 9 Location of Niger projects

Source: URU Metals

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Commodity Overviews Gold Gold has a use both as a basic commodity but also as a monetary asset; a store of wealth. While gold was seen as an unfashionable investment at the turn of the century, its importance has increased over the past decade to help diversify an asset portfolio, principally as gold price movements are often uncorrelated with the movements in value of other asset classes. Since a low annual average gold price of US$271/oz in 2001, the price of gold has steadily risen year-on-year to a nominal high of US$1669/oz in 2012. This rise is shown in Figure 10 below. 2012 was also the highest yearly real price of gold since the spike in price at the beginning of the 1980s. A sell off of gold during the Global Financial Crisis (GFC) did not dampen demand for too long and as the US dollar weakened the price of gold again increased, as Figure 6 shows. The gold price has been much more volatile since peaking at a monthly average high of US$1772/oz and a daily high of US$1895/oz in September 2011 – with much of the weakness on the back of a perceived strengthening of the US$ and on the back of the possible cessation of quantitative easing in the US with investors switching back into ‘riskier’ equity asset classes. Following 2 years trading sideways, in April 2013 there was a very large sell-off of gold with a precipitous fall in the price of gold over 2 days, a situation repeated in the end of June – where the gold price currently stands at $1295/oz. While the causes of the fall are not fully understood, and investors who are long-gold consider their investment options, there is no doubting the physical demand for metal, particularly in the far east. We do not see a full retreat in the price and consider that, while currently volatile, gold will remain an important asset diversifier going forward and should recover some of its price over the medium-term. Figure 10: Spot Gold Price

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d (U

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oz)

Source: Reuters Datastream, LBMA, World Gold Council

On the supply side, gold production tapered off at the end of the last decade, but has since picked up due to increased investment in project development. Typically new production lags the rise in gold price as it takes time to bring on new operations. From first discovery to operation, through all the stages of development to commissioning, usually takes up to 10 years and sometimes considerably longer for large-scale open pit

Gold still has an important role to diversity an asset portfolio

Gold has risen year-on-year for the past 12 years

Volatility in the gold price

Primary supply up, but only moderately

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operations. World gold mine production in 2012 was over 2842t/yr according to Thomson Reuters GFMS (GFMS); a 0.2% rise on 2011 and 2.8% rise on 2010 and the fourth year of mine production increases. The increase in production was driven by new projects and expansions in China, which has become largest country producer of gold in the world, and new mine production in Latin America. Threats of resource nationalisation and the demands of local and environmental groups may limit investment in certain developing countries going forward which will impact on primary mine production growth. A recent high profile example being in Peru where Newmont has delayed construction of the large Conga mine in response to local opposition to the project. Also, there has been a large and growing consumer demand for bar and coin and, more significantly, a return to Central Bank buying, particularly in developing countries who see gold as an important element in investment. Gold is seen as a more permanent store of wealth after more ‘exotic’ paper investments lost value during the Global Financial Crisis (GFC). It is especially seen as an important asset class following the GFC morphing from a banking crisis into a sovereign debt crisis. According to GFMS, coin and bar consumption was down slightly in 2012 at 1256t compared with 1515t in 2011, but official sector purchases were up to 535t in 2012 from 456t in 2011; a marked change from the net sale of 34t in 2009 and the more significant Central Bank sales in previous years. We see price volatility going forward, with potentially more Quantitative Easing and continuing mixed economic events in the global economy. Eventually we see a retreat in the gold price as global economic recovery takes hold. We set our long-term gold price at US$1300/oz. This is set at a premium to the marginal cash cost of production and is set to represent paper asset devaluation, Central Bank printing of money and the resultant inflationary risk and continuing uncertainty in the global economy. Our gold price forecast in Table 5 is a conservative estimate based on an overall strengthening of the global economy over the medium-term. Any deviation from this path of recovery, especially as attention once more is drawn to Southern European member states in the Eurozone, together with mixed economic data out of China and the USA, and the gold price could very well be much higher. This would bode well for producers as in a worst case scenario demand for gold would be higher and the gold price could inevitably be drawn to the higher levels of over US$2000/oz. In summary:

• Only moderate growth in gold supply anticipated • Investment interest and Central Bank demand to remain strong • Short-term moderate growth in global GDP and a possible further loosening of

monetary policy • Eurozone crisis to unfold further – more twists and turns expected • Low global Central Bank interest rates and negative real interest rates • Quantitative easing storing up further inflation for the future.

Growing demand from individuals, funds and Central Banks

Price volatility in the short-term. Longer term as recovery takes hold we see the price of gold falling. We set our long-term price at US$1300/oz

Gold price forecast is conservative, but set at a premium to the marginal cost of production. Possibility that gold will be higher than this over the medium-term

Table 5: WH Ireland Gold Price Assumptions

US$/oz 2011 2012 2013F 2014F 2015F 2016F Long-Term

Gold Price 1,572 1,690 1,425 1,375 1350 1300 1,300

Source: WH Ireland research

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Uranium Uranium is principally used for making electricity, with a small proportion used for medical isotopes and for marine propulsion, especially naval submarines. The price for uranium has been under pressure for several years, on the back of the Fukushima incident in Japan in 2011 and the fall-out from the uncertainty over several country’s nuclear power programmes. Prices have been soft for the past couple of years trading in a range of $40-60/lb – down form the price spike in 2007 when the price reached almost $140/lb and averaged over $100/lb over the course of the year. The uranium mining industry has not been immune from global cost escalation and prices at current levels are placing profit margin pressure on those higher-cost mines. This, coupled with an increasing demand and a delayed project pipeline means that prices must go higher (or there is a perception that prices will rise) over the medium-term if enough capacity is going to be incentivised into production. We put our long-term price at somewhere between $70-80/lb. Supply and demand are roughly balanced to tight until the latter years of this decade when more production needs to be in place to match the increased demand expected. Currently primary supply is estimated at ~150Mlbs U3O8/yr with an additional supply from secondary sources of ~45Mlbs U3O8/yr. This secondary supply is made up from stocks, inventories, reprocessed material and importantly from the highly-enriched uranium (HEU) deal. The HEU deal was a way of controlling the supply of decommissioned weapons-grade uranium and converting it to the production of power – this deal between the US and Russia is due to come to an end in 2013 when 24Mlbs of U3O8/yr – will be lost from the market. At this point the market moves from a small surplus to balanced and then into deficit by the end of the decade. Supply: six countries (Australia, Canada, Kazakhstan, Namibia, Niger and Russia) supply 85% of primary U3O8 and 63% of total demand. The largest mines are McArthur River (Canada), Moinkum / Tortkuduk (Kazakhstan), Olympic Dam and Ranger (Australia), Rossing (Namibia) and Arlit (Niger). These six mines produce 60Mlbs U3O8/yr. At current prices a number of projects have been delayed: Trekkopje in Namibia and Imouraren in Niger (Areva – 17Mlbs incremental capacity U3O8/yr) and the large Olympic Dam expansion in Australia (BHP Billiton – 33Mlbs U3O8/yr), though the latter is a by-product producer where the principal economic metal is copper. Some projects are still on track though with Husab in Namibia (12Mlbs U3O8/yr) and Mkuji River in Tanzania (7.5Mlbs U3O8/yr) the most significant. Production from current and known capacity is expected to peak by the end of the decade before declining. Additional capacity, from as yet unidentified sources, will be required before then to make up the demand shortfall and the loss of production upon resource depletion. Demand: The principal use of uranium is in power generation. Despite recent high-profile incidents at nuclear power plants and the increasingly vocal opposition from green groups and other NGOs, there will be a global increase in the use of nuclear power. This is for reasons of reducing greenhouse gas emission and operating cost (ignoring capital costs and decommissioning costs) but principally for reasons of energy security and a move away from a hydrocarbon-based/dependent energy supply. There are over 430 nuclear reactors in operation around the globe with a generating capacity of 370GW and an installed capacity of 475GW). There are currently 70 new plants under construction, with many more planned, for a further 68GW of generating capacity; with the vast majority in China and some significant increase in capacity in India,

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Russia and the middle East. In addition there will be more plants constructed to replace older units now past their useful life. Demand was knocked for a while after Fukushima; Japan and Germany stated a plan to move away from nuclear power generation. However, this is a difficult task for Japan and it has slowly re-started its nuclear capacity – with a longer-term intention to move to renewable and gas. The cost of this is large, however, and politically while the population wants to move away from nuclear, the costs to its manufacturing base on higher energy costs would be disastrous. We believe that Japanese capacity will slowly be brought back into production, although perhaps not the full capacity in place. Figure 11: Uranium Price History

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Source: Nuexco exchange spot, Indexmundi

Nickel Nickel is principally used in the production of stainless steel along with chrome and other metals. The market is currently over supplied, but is expected to tighten from the middle of the decade until by the end of the decade will be in deficit. Prices will remain range-bound over the next couple of years $7.5 – 8.5/lb, but will need to move higher from the current ~$6.5/lb levels as much of the higher cost part of the cost curve is under profit margin pressure; perhaps as much as 20-30%. Going forward many market commentators are using a long-term price in excess of our long-term price of $10/lb based on the ever increasing incentive price and the quality of projects in the project pipeline. Incentive prices have moved higher on the back of continued capital and operating cost escalation. For some projects the capital cost of bringing a mine into production is out of the reach of many companies. Capital intensity, a measure of capital cost per tonne of annual capacity, depends on the type of nickel plant being built. Sulphide deposits have a lower capital intensity than ferronickel smelters which have a lower capital intensity than the High Pressure Acid Leach plants (HPAL). Sulphide deposits do not have the associated smelter capital costs, but do have to take a lower percentage of the nickel price. URU’s capital costs (WHI estimates) of US$900 million (~$36/t of annual capacity)

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are in the same range as other large sulphide projects e.g Royal Nickel’s Dumont project in Canada. Another process route, which has perhaps contributed to the current surplus, is the production of nickel pig iron (NPI). Nickel-bearing laterites are sent raw from the Philippines and Indonesia to China where they are treated as a low-grade, nickel-rich, iron ore for blast furnaces to produce pig iron for the stainless steel industry. Indonesia has put an export tax on this raw material and is moving to a complete ban by 2014. If this were to happen then unless additional supplies could be sourced from the Philippines, or Chinese production moved to Indonesia, then the surplus would come down rapidly. There is a risk that any increase in NPI production, if alternative ore sources could be found, could cause a structural shift and that nickel prices become range-bound for a longer period. Production: Global Mined production is roughly 2Mt/yr nickel which, after production losses, equates to ~1.8Mt/yr refined production. Half of the refined production comes from sulphide mines with the other half from laterite ore sources. There will be a requirement for additional sulphide production in the form of concentrates from the middle of this decade as some sulphide mines close on depletion of resources. The production from Zebediela could meet part of that production requirement Demand: Global demand is in the order of 1.7-1.8Mt/yr refined nickel with two thirds used in stainless steel. China has been the main driver of demand over the past decade and is forecast to maintain this position. Figure 12: Nickel Price History

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Source: UBS

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Management Roger Lemaitre - Executive Director and Chief Execu tive Officer Roger is a Professional Engineer and Geologist with more than 20 years of professional experience, predominantly with major mining companies. For the past 11 years, he has held a variety of senior management positions with Cameco Corporation, one of the world's largest uranium producers, and was most recently Cameco's Director of Worldwide Exploration. In this position, Roger had responsibility for overseeing Cameco's international exploration programs and budgets on 95 different projects coordinated from three offices located on three continents, the negotiation of earn-in and farm-out joint ventures and strategic alliances, and generating and implementing exploration strategies worldwide. Prior to joining Cameco, Roger was a project and field geologist for senior mining companies and junior explorers searching for copper, zinc and gold. Roger has a Master of Business Administration from Athabasca University, a Master of Applied Science in Geology from McGill University and a Bachelor of Applied Science in Geological Engineering from Queen's University. David Subotic – Non-Executive Director and Chairman Mr. Subotic is a former Vice President of Haywood Securities, an international investment firm specialising in the resource sector, where he helped raise more than $2 billion in financing for commodities and oil and gas companies. Previously, Mr. Subotic was Vice President of Canada's Yorkton Securities, a national full-service firm that provides services to institutional investors, issuing companies and retail clients. Most recently, Mr. Subotic was the founder and CEO of Asian Coast Development Ltd., an international resort developer planning the $4.2 billion Ho Tram Strip integrated resort destination in Southern Vietnam. Mr. Subotic is currently the CEO and CIO of DAS Capital, a Singapore- and Toronto-based hedge fund, and President, CEO and Director of NWT Uranium Corp. JayViera – Non-Executive Director Mr. Vieira is, and has been since 2006, a partner with the law firm of Fogler, Rubinoff LLP, Toronto, Ontario. Prior to that and since 2000, Mr. Vieira was an associate with Sui & Pathak, Sui & Company and Himlefarb, Prozanski as well as being a sole practitioner. Mr. Vieira focuses on the area of securities and corporate finance. Mr. Vieira is a member of the Canadian and Ontario bar associations and the Law Society of Upper Canada. Mr. Vieira was admitted to the Ontario bar in 1999 after obtaining his LL.B. from the University of Windsor Law School. Mr. Vieira holds a B.A. (Hons.) in Humanities from McMaster University.

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Canada Overview

A land of vast distances and rich natural resources, Canada became a self-governing dominion in 1867 while retaining ties to the British crown. Economically and technologically, the nation has developed in parallel with the US, its neighbour to the south across the world's longest unfortified border. Canada faces the political challenges of meeting public demands for quality improvements in health care, education, social services, and economic competitiveness, as well as responding to the particular concerns of predominantly francophone Quebec. Canada also aims to develop its diverse energy resources while maintaining its commitment to the environment.

Sweden Overview

A military power during the 17th century, Sweden has not participated in any war for almost two centuries. An armed neutrality was preserved in both world wars. Sweden's long successful economic formula of a capitalist system interlarded with substantial welfare elements was challenged in the 1990s by high unemployment and in 2000-02 and 2009 by the global economic downturns, but fiscal discipline over the past several years has allowed the country to weather economic vagaries. Sweden joined the EU in 1995, but the public rejected the introduction of the Euro in a 2003 referendum.

Figure 13: Map of Canada

Source: CIA World Factbook

Figure 14: Map of Sweden

Source: CIA World Factbook

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South Africa Overview

Dutch traders landed at the southern tip of modern day South Africa in 1652 and established a stopover point on the spice route between the Netherlands and the Far East, founding the city of Cape Town. After the British seized the Cape of Good Hope area in 1806, many of the Dutch settlers (the Boers) trekked north to found their own republics. The discovery of diamonds (1867) and gold (1886) spurred wealth and immigration and intensified the subjugation of the native inhabitants. The Boers resisted British encroachments but were defeated in the Boer War (1899-1902); however, the British and the Afrikaners, as the Boers became known, ruled together beginning in 1910 under the Union of South Africa, which became a republic in 1961 after a whites-only referendum. In 1948, the National Party was voted into power and instituted a policy of apartheid - the separate development of the races - which favoured the white minority at the expense of the black majority. The African National Congress (ANC) led the opposition to apartheid and many top ANC leaders, such as Nelson Mandela, spent decades in South Africa's prisons. Internal protests and insurgency, as well as boycotts by some Western nations and institutions, led to the regime's eventual willingness to negotiate a peaceful transition to majority rule. The first multi-racial elections in 1994 brought an end to apartheid and ushered in majority rule under an ANC-led government. South Africa since then has struggled to address apartheid-era imbalances in decent housing, education, and health care. ANC infighting, which has grown in recent years, came to a head in September 2008 when President Thabo Mbeki resigned, and Kgalema Motlanthe, the party's General-Secretary, succeeded him as interim president. Jacob Zuma became president after the ANC won general elections in April 2009. Recently, there has been unrest in the South African mining industry. The most notable event was the strike at Lonmin’s Marikana mine with violence and loss of life after striking miners were shot by police as they demonstrated then charged the police lines armed with weapons. Protests spread firstly to other PGM mines then to gold mines and then in a small way to the diamond mines operated by Petra. The situation is ongoing and it is not known when this period of action will end as it is chaotic and unpredictable and is not being handled in a very efficient manner by the South African government; which has seemed unable to gain any control over the process. Perhaps all of this can be seen in the wider picture of the whole BEE process and dissatisfaction with the way that not more South Africans are benefitting from access to South Africa’s evident mineral wealth. Reduction in economic growth and the ongoing uncertainty in the mining industry has led to a fall in the value of the Rand which could a concern for foreign investors.

Figure 15: Map of South Africa

Source: CIA World Factbook

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URU METALS

Niger Overview

Niger became independent from France in 1960 and experienced single-party and military rule until 1991, when Gen. Ali Saibou was forced by public pressure to allow multiparty elections, which resulted in a democratic government in 1993. Political infighting brought the government to a standstill and in 1996 led to a coup by Col. Ibrahim Bare. In 1999, Bare was killed in a counter coup by military officers who restored democratic rule and held elections that brought Mamadou Tandja to power in December of that year. Tandja was re-elected in 2004 and in 2009 spearheaded a constitutional amendment that would allow him to extend his term as president. In February 2010, a military coup deposed Tandja, immediately suspended the constitution, and dissolved the Cabinet. Issoufou Mahamadou emerged victorious from a crowded field in the election following the coup and was inaugurated in April 2011. Niger is one of the poorest countries in the world with minimal government services and insufficient funds to develop its resource base. The largely agrarian and subsistence-based economy is frequently disrupted by extended droughts common to the Sahel region of Africa. The Nigerien Movement for Justice, a predominately Tuareg ethnic group, emerged in February 2007, and attacked several military targets in Niger's northern region throughout 2007 and 2008. Successful government offensives in 2009 limited the rebels' operational capabilities. Niger is facing increased security concerns on its borders from various external threats including insecurity in Libya and spill over from the rebellion in Mali. Recently, the country has once again been in the news as al-Qaida-linked groups attacked two French-owned uranium mines in northern Niger. Lying on the borders of Mali, Algeria and Libya to the west and north does not make Niger the safest place to carry out mineral exploration or mining. The country may also try and renegotiate its uranium mining agreements as the President has stated that it should receive more benefit from its most valuable export. The President may also look to increase the diversity of its mining partners and bring in some Chinese cooperation. Potential resource nationalisation and security concerns places a greater degree of risk in operating in Niger.

Figure 16: Map of Niger

Source: CIA World Factbook

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URU METALS

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URU METALS

Share Price Target The share price target is the level the stock should currently trade at if the market were to accept the analyst’s view of the stock and if the necessary catalysts were in place to effect this change in perception within the performance horizon.

Stock Rating Distribution

As at the quarter ending 31 March 2013 the distribution of all our published recommendations is as follows:

Recommendation Total Stocks Percentage % Corporate

Buy 71 76 54

Speculative Buy 14 15 14

Outperform 3 3 3

Market Perform 5 6 2

Underperform 0 0 0

Sell 0 0 0

Total 93 100 73

This table demonstrates the distribution of WH Ireland recommendations. The first column illustrates the distribution

in absolute terms with the second showing the percentages. Conflicts of Interest Policy

This research is classified as being “non-independent” as defined by the FCA’s Conduct of Business Rule 12.3.

Please refer to www.wh-ireland.co.uk for a summary of our conflict of interest policy. *WH Ireland acts as broker and/or Nomad to URU Metals

#WH Ireland makes markets in this company

WH Ireland has acted as manager in the underwriting or placement of securities of this company within the last 12

months.

Within the past 12 months, WH Ireland has received compensation for investment banking services from this company. Analyst Certification The research analyst or analysts attest that the views expressed in this research report accurately reflect his or her personal views about the subject security and issuer.

Companies Mentioned

Share Price Date/Time

Company Name Recommendation Price Price Date/Time

URU Metals Speculative Buy 2.1p 21 June 2013: 16:30

Summary of Company Notes

Headline Date

URU Metals: Initiation of Coverage 21 June 2103

Summary of Security Recommendations

Recommendation From To Analyst

URU Metals 21/06/2013 NA CA

Current Analyst (CA), Previous Analyst (PA)

WH Ireland Recommendation Definitions

Buy Expected to outperform the FTSE All Share by 15% or more over the next 12 months.

Outperform Expected to outperform the FTSE All Share by 5/15% over the next 12 months.

Market Perform Expected to perform in line with the FTSE All Share over the next 12 months.

Underperform Expected to underperform the FTSE All Share by 5/15% or more over the next 12 months.

Sell Expected to underperform the FTSE All Share by 15% or more over the next 12 months.

Speculative Buy The stock has considerable level of upside but there is a higher than average degree of risk.

Disclosures

Disclaimer This research recommendation is intended only for distribution to Professional Clients and Eligible Counterparties as defined under the rules of the Financial Services Authority and is not directed at Retail Clients. This note contains investment advice of both a general and specific nature. It has been prepared with all reasonable care and is not knowingly misleading in whole or in part. The information herein is obtained from sources which we consider to be reliable but its accuracy and completeness cannot be guaranteed. The opinions and conclusions given herein are those of WH Ireland Ltd. and are subject to change without notice. Clients are advised that WH Ireland Ltd. and/or its directors and employees may have already acted upon the recommendations contained herein or made use of all information on which they are based. WH Ireland is or may be providing, or has or may have provided within the previous 12 months, significant advice or investment services in relation to some of the investments concerned or related investments. Recommendations may or may not be suitable for individual clients and some securities carry a greater risk than others. Clients are advised to contact their investment advisor as to the suitability of each recommendation for their own circumstances before taking any action. No responsibility is taken for any losses, including, without limitation, any consequential loss, which may be incurred by clients acting upon such recommendations. The value of securities and the income from them may fluctuate. It should be remembered that past performance is not necessarily a guide to future performance. For our mutual protection, telephone calls may be recorded and such recordings may be used in the event of a dispute. Please refer to www.wh-ireland.co.uk for a summary of our conflicts of interest policy and procedures.

Company Name Recommendation Price Price Date/Time

URU Metals Speculative Buy 2.1p 21 June 2013: 16:30