Annual Report for Fiscal Year Ending December 31, 2024 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

The information disclosed in this annual report, and the information incorporated by reference herein, includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements include, but are not limited to, statements regarding our or our management's expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

The forward-looking statements contained or incorporated by reference in this annual report are based on our current expectations and beliefs concerning future developments and their potential effects on us and speak only as of the date of each such statement. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in Item 1A, "Risk Factors" and this Item 7 of this annual report. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

The following discussion should be read in conjunction with our audited consolidated annual financial statements and footnotes thereto contained in this annual report.

Overview

General

Western Uranium & Vanadium Corp. ("Western" or the "Company", formerly Western Uranium Corporation) was incorporated in December 2006 under the Ontario Business Corporations Act. On November 20, 2014, the Company completed a listing process on the Canadian Securities Exchange ("CSE"). As part of that process, the Company acquired 100% of the members' interests of Pinon Ridge Mining LLC ("PRM"), a Delaware limited liability company. The transaction constituted a reverse takeover ("RTO") of Western by PRM. Subsequent to obtaining appropriate shareholder approvals, the Company reconstituted its board of directors and senior management team. Western is a Canadian domestic issuer and Canadian reporting issuer.

On August 18, 2014, the Company closed on the purchase of certain mining properties in Colorado and Utah from Energy Fuels Holding Corp. Assets purchased included both owned and leased lands in Utah and Colorado, and all represent properties that have been previously mined for uranium to varying degrees in the past. The acquisition included the purchase of the Sunday Mine Complex. The Sunday Mine Complex is located in western San Miguel County, Colorado. The complex consists of the following five individual mines: the Sunday mine, the Carnation mine, the St. Jude mine, the West Sunday mine and the Topaz Mine. The operation of each of these mines requires a separate permit, and all such permits have been obtained by Western and are currently valid. In addition, each of the mines has good access to a paved highway, electric power to existing declines, office/storage/shop and change buildings, and an extensive underground haulage development with several vent shafts complete with exhaust fans. The Sunday Mine Complex is the Company's core resource property and in July 2021 was assigned "Active" status when mining operations were restarted.

On September 16, 2015, Western completed its acquisition of Black Range, an Australian company that was listed on the Australian Securities Exchange until the acquisition was completed. The acquisition terms were pursuant to a definitive Merger Implementation Agreement entered into between Western and Black Range. Pursuant to the agreement, Western acquired all of the issued shares of Black Range by way of Scheme of Arrangement ("the Scheme") under the Australian Corporation Act 2001 (Cth) (the "Black Range Transaction"), with Black Range shareholders being issued common shares of Western on a 1 for 750 basis. On August 25, 2015, the Scheme was approved by the shareholders of Black Range, and on September 4, 2015, Black Range received approval by the Federal Court of Australia. In addition, Western issued options to purchase Western common shares to certain employees, directors, and consultants. Such stock options were intended to replace Black Range stock options outstanding prior to the Black Range Transaction on the same 1 for 750 basis.

Under United States Securities and Exchange Commission ("Commission") rules, the Black Range transaction triggered the Company being deemed a United States domestic issuer and losing its foreign private issuer exemption. On April 29, 2016, the Company filed a Form 10 registration statement with the Commission after shifting its basis of accounting from IFRS to U.S. GAAP. On June 28, 2016, the Company's registration statement became effective and Western became a United States reporting issuer.

On June 30, 2023, Western re-qualified as a foreign private issuer as that term is defined in Rule 3b-4(c) promulgated under the Exchange Act. As a result, the Company may now utilize certain accommodations made to foreign private issuers, including (1) an exemption from complying with the Commission's proxy rules, (2) an exemption from the Company's insiders having to comply with the reporting and short-swing trading liability provisions of Section 16 under the Exchange Act, (3) the ability to make periodic filings with the Commission on the Form 20-F and Form 6-K foreign issuer forms, and (4) the ability to offer and sell unrestricted securities outside of the United States pursuant to Rule 903 of Regulation S. The Company plans to take advantage of these accommodations. However, the Company currently has decided to voluntarily continue to file periodic reports with the Commission using domestic issuer forms including filing annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. On the subsequent measurement date, June 30, 2024, Western reconfirmed its qualification as a foreign private issuer.

The Company has registered offices at 5 Church Street, Toronto, Ontario, Canada, M5E 1M2, and its common shares are listed on the CSE under the symbol "WUC" and are traded on the OTCQX Best Market under the symbol "WSTRF". Its principal business activity is the acquisition and development of uranium and vanadium resource properties in the states of Utah and Colorado in the United States of America ("United States").

Recent Developments

Ore Purchase Agreement

On April 8, 2025, PRM entered into an Ore Purchase Agreement (the "Ore Purchase Agreement") with subsidiaries of Energy Fuels Inc. ("Purchaser"). The Ore Purchase Agreement is for a one year period and provides for the delivery of up to 25,000 short tons of uranium bearing ore to the White Mesa Mill in Blanding, Utah. PRM shall make deliveries at its own cost and the purchase price per ton will be based upon the average grade of uranium within each lot, and other qualifying conditions. Within 30 days after each lot is closed, the Purchaser shall pay to PRM an 85% provisional payment calculated based upon the sampled grade and an agreed upon pricing schedule. Within 30 days after each lot is fed to processing, the Purchaser shall pay to PRM a final settlement payment calculated based upon the assayed grade and the agreed upon pricing schedule, net of a royalty, pursuant to a previously existing royalty agreement with the Purchaser.

Mustang Mineral Mill Site Acquisition

On October 1, 2024, Western, through its wholly owned subsidiary, Western Utah, executed a binding stock purchase agreement to purchase 100% of the shares of PRC from a private investor group and thereby acquire Mustang, which is a wholly owned subsidiary of PRC. Mustang owns an 880-acre property located in Montrose County, Colorado, where a uranium processing mill was previously licensed but never constructed. The acquisition becomes the second property that Western has acquired, in addition to the Maverick site in Utah. It also becomes part of Western's plans for developing and licensing one or more uranium and vanadium processing facilities to process production from its resource properties in Colorado and Utah.

The Company assumed an obligation to an unrelated third party to remit a royalty based on the volume of minerals processed through any mineral processing plant located on the property.

George Glasier, the President, CEO and a director of Western, and his wife Kathleen owned 50% of the shares of PRC and Andrew Wilder, a director of Western, indirectly owned 3% of the shares of PRC, and so the transaction was considered a related party transaction. The Company's Board of Directors established an independent committee of the Board comprised of directors who were not considered to have an interest in the transaction, and the independent committee oversaw the negotiation and approved the entering into the agreement on behalf of the Company.

The total purchase price of PRC was $1.98 million, which consisted of an aggregate of $829,167 in payments to former PRC shareholders for their equity interests and outstanding loans made to PRC and related accrued interest and a $1,148,125 payment for principal and interest to a third party in satisfaction of an assumed liability of Mustang. For the 53% ownership of PRC, $414,584 was paid to George Glasier and $24,875 was paid to an affiliate of Andrew Wilder.

The transaction was accounted for as a purchase of an asset.

Mustang Mineral Processing Plant

Our current plans call for the permitting and construction of a mineral processing plant at its newly acquired site in Colorado. Western expects to benefit from the prior site owner's completion of all phases of licensing and permitting of their Pinon Ridge Mill project. The Company's plans are to develop its initial mill at the Colorado location, which is much closer to the Sunday Mine Complex. This mill is expected to have a cost of approximately $75 million and is planned to start-up in 2029. This facility will be designed to recover uranium and vanadium both from conventional materials mined from Company mines and materials produced by other mining companies. The processing plant will utilize the latest processing technology, including Western's patented Kinetic Separation process. These technology advancements will result in lower overall capital and processing costs. After permitting and construction, and subject to available financing, the processing of uranium and vanadium materials is targeted to commence in 2029.

Bullen Property (Weld County)

In 2017, the Company entered into an oil and gas lease that became effective with respect to minerals and mineral rights owned by the Company of approximately 160 surface acres of the Company's mining property in Colorado. As consideration for entering into the lease, the lessee has agreed to pay the Company a royalty from the lessee's revenue attributed to oil and gas produced, saved, and sold attributable to the net mineral interest. The Company has also received cash payments from the lessee related to the easement that the Company is recognizing incrementally over the eight year term of the easement.

On June 23, 2020, the operator elected to extend the oil and gas lease easement for three additional years through July 2023. This was done to provide additional time in order to complete well construction and commence oil and gas production. During 2021, the operator completed a first set of eight (8) wells which commenced oil and gas production by August 2021. During 2022, the operator completed a second set of eight (8) wells which commenced oil and gas production by August 2022. All sixteen (16) wells remain in production and monthly royalty payments will be ongoing in perpetuity as long as oil and/or gas are produced from the pooled unit containing these sixteen (16) wells.

During the years ended December 31, 2024 and 2023, we recognized aggregate revenue of $183,803 and $431,065, respectively, under these oil and gas lease arrangements.

Kinetic Separation Licensing

On December 1, 2016 a determination was made by the CDPHE considering the NRC Advisory Opinion, the Colorado public meeting process, and the CDPHE regulatory and evaluation framework. This determination stated that the proposed Kinetic Separation operations at the Sunday Mine by Black Range Minerals must be regulated by the CDPHE through a milling license. Previously, the Company was unable to deploy Kinetic Separation as it was without a regulatory framework, but as a result of this determination the Company is now able to deploy Kinetic Separation under a milling license. The Colorado milling license that Western is currently seeking will likely incorporate Kinetic Separation via an amendment to the initial license - as Western's current plan is to submit a licensing application that is substantially identical to the application that was used previously for the Pinon Ridge Mill (which did not include the Company's Kinetic Separation technology).

Stockpiled Mined Materials Inventory

From December 2021 through March 2022, 3,140 tons of uranium/vanadium material was mined from the Sunday Mine Complex. The mining contractor calculated uranium grades based upon scintillometer sampling of each 10-ton truckload and vanadium quantities were derived by applying the 6:1 historical ratio. The estimated stockpiled inventory is 50,289 pounds of uranium and 301,736 pounds of vanadium. The value of this stockpile is not reflected as an asset on the balance sheet as the costs to produce the stockpiled inventory was expensed in accordance with Regulation SK-1300. The in-house mining team stockpiled limited quantities of additional mined material in the current year. It is Western's intent to sell some of this stockpiled material to Energy Fuels under the Ore Purchase Agreement.

November 2024 Private Placement

On November 20, 2024, the Company closed a private placement of 4,142,906 units at a price of $0.94 (CAD $1.32) per unit. The aggregate gross proceeds raised in the private placement amounted to $3,897,166 (CAD $5,468,636) and proceeds net of issuance costs were $3,546,870 (CAD $4,975,966). Each unit is comprised of one common share of Western and one common share purchase warrant. Each warrant is exercisable into one common share at a price of $1.27 (CAD $1.78) per share for a period of four years following the closing date of the private placement.

Incentive Stock Option Plan

The Company maintains an Incentive Stock Option Plan (the "Plan") that permits the granting of stock options as incentive compensation.

Stock Option Grants

On December 20, 2023, the Board of Directors granted options under the Plan for the purchase of an aggregate of 1,525,000 common shares to individuals consisting of directors and officers of the Company. Each of these options have a term which ends five years from the vesting date, an exercise price of $1.20 (CAD $1.60 as of December 31, 2023) and vest equally in thirds on January 31, 2024, July 31, 2024 and January 31, 2025.

On July 14, 2024, the Board of Directors granted an option under the Plan for the purchase of an aggregate of 100,000 common shares to a director of the Company. This option has a term which ends five years from the vesting date, an exercise price of $1.47 (CAD $2.00 as of July 14, 2024) and vests one half on each of July 31, 2024 and January 31, 2025.

On November 24, 2024, the Board of Directors granted options under the Plan for the purchase of an aggregate of 1,375,000 common shares to individuals consisting of directors and officers of the Company. Each of these options have a term which ends five years from the vesting date, an exercise price of $0.94 (CAD $1.32 as of November 29, 2024) and vest equally in thirds on January 31, 2025, July 31, 2025 and January 31, 2026.

Biden-Harris, Trump 1.0 and Trump 2.0 Administration Initiatives

During the first Trump Administration, the U.S. government focused on market distortions caused by foreign state-owned enterprises and the economic and geopolitical influence lost by allowing Russia and China to take the global lead in nuclear power. In support of the world's largest nuclear reactor fleet, the U.S. has implemented some of the recommendations of the Nuclear Fuel Working Group which followed the uranium Section 232 investigation. The Russia/Ukraine war has highlighted the nuclear fuel supply chain risks and the geopolitical risks of dependence on the direct and indirect sourcing of nuclear fuel from state owned enterprises in Russia and former Soviet Union republics. This led to the implementation of the Uranium Reserve Program where the U.S. Department of Energy ("DOE") purchased 1,100,000 lbs of U.S. domestic origin uranium in the first quarter of 2023.

Upon taking office, the Biden-Harris Administration team immediately rejoined the Paris Climate Accord, reversed a number of pro-fossil fuel energy policies, and gave all agencies climate change initiatives. The Administration continued to advance a national clean energy standard. U.S. utilities were expected to be required to produce an increasing proportion of electricity generation from clean energy power sources. On August 16, 2022, the Inflation Reduction Act was signed into law authorizing governmental investments of approximately $369 billion in climate and energy, a portion of which would benefit the U.S. domestic nuclear industry and battery technologies.

On November 5, 2024, the United States held a highly contested Presidential election between Republicans (Trump-Vance) and Democrats (Harris-Walz). The Trump-Vance Republican ticket won, returning former President Donald Trump to the Presidency on January 20, 2025. In addition, Republicans have achieved Congressional majorities in both the Senate and House of Representatives. As a result, President Trump's legislative priorities will likely face less resistance in Congress. Currently, nuclear energy enjoys bipartisan support. With the change in Presidential Administrations, we are already observing the climate change and clean energy initiatives of the Biden-Harris Administration being de-emphasized. In his first day in office, President Trump signed Executive Orders declaring a National Energy Emergency and a U.S. withdrawal from the Paris Climate Agreement for a second time. The new Administration is seeking a reduction in the federal government's size and regulatory power, and the newly-established Department of Government Efficiency (DOGE) has implemented workforce layoffs with the goal of a federal government headcount reduction. On February 14, 2025, President Trump signed an Executive Order creating the National Energy Dominance Council. On March 20, 2025 to boost domestic production of critical minerals and reduce reliance on foreign imports, President Trump signed an Executive Order titled "Immediate Measures to Increase American Mineral Production." On April 9, 2025, President Trump signed an Executive Order entitled "Zero-based Regulatory Budgeting to Unleash American Energy" to reduce costs on energy production by requiring conditional sunset dates for regulations. However, these positive developments for domestic energy have been overshadowed by the announcements of U.S. tariffs and reciprocal tariffs on the U.S.'s largest trading partners. Tariffs have been implicated as the driver of volatility across global capital markets. Subsequently, President Trump authorized a 90-day pause on reciprocal tariffs and instead implemented a flat 10% tariff while the pause is in effect. This action calmed markets. Most countries benefited from this pause; however, it was implemented in parallel with an increase on Chinese tariffs, and thus escalated a U.S. - China trade war.

Nuclear Fuel and Uranium Market Conditions

During the year ended December 31, 2024, the spot uranium price decreased $18 from $91 to ~$73. Notably, the long-term price increased from $68 to ~$81 during a period of rising conversion and enrichment services prices. However, this follows an extremely strong period in the market where spot uranium prices have reacted to supply/demand constraints and geopolitical risks. Since January 2024, spot uranium had a slow decline from a high of $100/lb level to $64/lb level at the end of March 2025. The events of 2022 have set in motion uranium market and nuclear fuel opportunities for the next decade and beyond. There are positive catalysts across multiple levels of the nuclear fuel and uranium markets. Underlying fundamentals are the strongest in decades. This is attributable to multiple factors, including climate change, energy security, supply chain and energy scarcity initiatives. The supply/demand imbalance has flipped from a market with excess supply into a market with excess future demand. With the reduced availability of secondary supplies, utilities have begun adding multi-year contracts with mining companies for primary supply. The drivers expanding the demand for nuclear fuel include non-nuclear nations adding nuclear power generation, nuclear nations expanding fleets and/or extending lives of existing reactors, idled nuclear reactors being redeployed, the reversal of phase-outs and shutdowns, and the deployment of advanced reactors / SMRs. However, the challenge is in meeting increasing demand simultaneously with supply constraints from the world's largest suppliers. We believe uranium equity prices will continue to strengthen and reflect the underlying positive fundamentals in the nuclear/uranium sector. Multiple market analysts have flagged low availability of mobile secondary inventories. We believe the continued draw down of inventories to be a market catalyst for uranium prices.

Positive nuclear energy news has continued to highlight the global growth of future nuclear electricity generation which will drive increased nuclear fuel demand. In terms of future supply, utility contracting has continued into 2024, and some uranium mining companies are moving toward restarting production. However, due to the lead time needed for future uranium production, we are entering a phase where the supply-demand fundamentals are in a deep multi-year structural supply deficit. The future is not clear as we believe some miners with available near-term production are waiting for higher price levels and/or project funding before making full start-up commitments. Utilities are also deferring contracting to understand how regulations and geopolitics will modify their future access to Russian uranium, conversion and enrichment services.

In the second quarter of 2024, investors began purchasing nuclear and uranium equities as a means to create long exposure for their positive view on Artificial Intelligence (AI), due to the vast energy requirements of data centers. Recent transactions have been announced as tech giants Microsoft, Amazon, and Google have sought deals to source nuclear power for their data centers from full scale reactors and SMRs. Microsoft most prominently signed an agreement with Constellation Energy to restart a Three Mile Island reactor in Pennsylvania and purchase 100% of the power generated for two decades.

Nuclear Fuel Supply Chain Concentration Risks

Russia's invasion of Ukraine and the ensuing global energy crisis has focused attention on security of supply and supply chain risks. This has caused most of the world to re-evaluate their dependence upon nuclear fuel exported by Russia. In spite of the dominant market position of Rosatom, future deliveries potentially could be at risk due to sanctions, legislation, or a Russian embargo. Customer dependence upon the Russian supply of uranium, conversion and enrichment are being addressed slowly by governments as alternative suppliers are not currently available. Both Urenco and Orano have announced that they will invest to expand their uranium enrichment capacity respectively in the United States and France, which represents a shift away from Russia. Utilities are demonstrating their desire for increased security of their nuclear fuel supply chains. Kazakhstan is also a concern because the world's largest uranium producing country has an unguarded and the second longest continuous land border in the world shared with Russia. The potential exists for Russia to exert influence over Kazakhstan. Additionally, Kazatomprom has put large long-term contracts in place with China. This supply is needed for China to fulfill its 15 year plan to deploy 150 new nuclear reactors. China National Nuclear Corp. (CNNC) has recently opened a uranium trading hub /warehouse facility, on the China / Kazakhstan border, with the capacity to store 60 million pounds of uranium. It has become evident that the nuclear fuel supply chain has become increasingly concentrated and interconnected in this very small area of the world. Expanding Kazakhstan uranium exports to Russia and China significantly reduces future supply for Western nuclear fuel buyers.

In July 2023, the government of Niger was overthrown by its military. This is significant because the new regime is opposed to Western interests and this landlocked West African country holds the 7th largest uranium resource in the world and was producing about 5% of global production. The conflict has an anti-French sentiment, and the Junta has initiated multiple actions that are counter to French interests. Most importantly, Niger's Junta has threatened the export of uranium to France which has serious implications because France acquires 20% of its natural uranium from Niger. In addition to the French evacuating/ being expelled from Niger, the U.S. military also departed the country. The Junta is utilizing Russian military support as a replacement. In addition, the Niger government has revoked operating permits from foreign uranium companies, including Orano in June 2024 and Goviex in July 2024. In November 2024, Orano further reported that it had lost operational control, to authorities in Niger, of another of its uranium mines. This mine was in production, but had been impacted by export restrictions imposed by the Junta.

During October 2023, geopolitical instabilities spread further to the Middle East after a Hamas attack on Israel triggered a counterattack by Israel on the Gaza Strip. The Israel-Hamas hostilities have escalated over the Summer of 2024 and then spread to other countries in the Middle East. At the beginning of 2025, Israel and Hamas agreed to a ceasefire which ended in March 2025; the hostilities resumed in March and it's not clear when and if the combatants will be able to negotiate a new ceasefire or an end to military actions. This additional hot spot further increases volatility in the world and destabilizes the Middle East region that is highly influential on global energy prices.

Results of Operations

Year Ended December 31, 2024 as Compared to the Year Ended December 31, 2023

The following table presents the Company's financial results for the years ended December 31, 2024 and 2023.

		For the Years Ended December 31,
		2024				2023
Revenues		$	183,803			$	431,065
Expenses
Mining expenditures			5,285,140				2, 951,579
Professional fees			613,403				386,473
General and administrative			3,599,460				1,884,456
Consulting fees			1,020,577				304,457
Total operating expenses			10,518,580				5,526,965
Operating loss			(10,334,777	)			(5,095,900	)
Interest income, net			224,738				158,904
Other expense, net			(1,998	)			(5,598	)
Net loss			(10,112,037	)			(4,942,594	)
Other comprehensive (loss) income
Foreign currency translation adjustment			(159,862	)			187,123
Comprehensive loss		$	(10,271,899	)		$	(4,755,471	)

Summary:

Our consolidated net loss for the years ended December 31, 2024 and 2023 was $10,112,037 and $4,942,594, respectively. The principal components of these year over year changes are discussed below.

Our comprehensive loss for the years ended Decembers 31, 2024 and 2023 was $10,271,899 and $4,755,471, respectively.

Revenues

Revenues for the year ended December 31, 2024 were $183,803 as compared to $431,065 for the year ended December 31, 2023. The decrease in revenues of $247,262, or 57%, was primarily related to lower production volumes from the oil and gas wells due to short-term well-pad maintenance shutdown in the second quarter and lower well performance attributable to production decline curves during the year ended December 31, 2024 as compared to the year ended December 31, 2023.

Mining Expenditures

Mining expenditures for the year ended December 31, 2024 were $5,285,140 as compared to $2,951,579 for the year ended December 31, 2023. The increase in mining expenditures of $2,333,561, or 79%, was principally attributable to the scaling up of mining activities at the Sunday Mine Complex, which involved the hiring of additional mining personnel, increased mining services and supplies costs, and increased maintenance and depreciation costs for mining equipment and vehicles placed into service.

Professional Fees

Professional fees for the year ended December 31, 2024 were $613,403 as compared to $386,473 for the year ended December 31, 2023. The increase in professional fees of $226,930, or 59%, was primarily due to increased accounting and legal costs in connection with an elevated level of business, mining and acquisition activities.

General and Administrative

General and administrative expenses for the year ended December 31, 2024 were $3,599,460 as compared to $1,884,456 for the year ended December 31, 2023. The increase in general and administrative expenses of $1,715,004, or 91%, is primarily due to increases in employee headcount and compensation, employee benefits, non-cash stock-based compensation and insurance costs in connection with increased mining activities.

Consulting Fees

Consulting fees for the year ended December 31, 2024 were $1,020,577 as compared to $304,457 for the year ended December 31, 2023. The increase in consulting fees of $716,120 was due to the costs incurred during the period for the licensing and permitting of the mineral processing plant sites in Utah and Colorado.

Interest Income, Net

Interest income, net for the year ended December 31, 2024 was $224,738 as compared to $158,904 for the year ended December 31, 2023. The increase in interest income, net of $65,834, or 41%, was principally attributable to higher interest rates earned on higher cash balances during the year ended December 31, 2024 compared to the year ended December 31, 2023.

Other Expense, Net

Other expense, net for the year ended December 31, 2024 was $1,998 as compared to $5,598 for the year ended December 31, 2023. The decrease in other expense, net was primarily due to a lower loss on the sale of a used vehicle during the year ended December 31, 2024 as compared to the year ended December 31, 2023.

Foreign Currency Translation Adjustment

Foreign currency translation adjustment for the year ended December 31, 2024 was a loss of $159,862 as compared to a gain of $187,123 for the year ended December 31, 2023. The change in foreign currency translation adjustment is primarily due to the weakening of the CAD against the USD.

Liquidity and Capital Resources

Our cash and cash equivalents and restricted cash balance as of December 31, 2024 was $6,295,624. Our cash position is highly dependent on our ability to raise capital through the issuance of debt and equity and our management of expenditures for mining and for the development of our mineral processing mill and for the fulfillment of our public company reporting responsibilities. Our management believes that in order to finance the development and mining operations of the mining properties, to construct our Kinetic Separation equipment and operations and to secure regulatory licenses for and to construct our uranium and vanadium minerals processing facilities, we will be required to raise additional capital by way of debt and/or equity. We will also require additional working capital to continue to scale-up our mining operations at the Sunday Mine Complex. This outlook is based on our current financial position and is subject to change if opportunities become available based on current exploration program results and/or external opportunities.

Net Cash Used In Operating Activities

Net cash used in operating activities was $8,297,043 for the year ended December 31, 2024, as compared with $4,089,495 used in operating activities for the year ended December 31, 2023. The increase of $4,207,548 in cash used in operating activities was principally driven by an increase in net loss of $5,169,443, offset by an increase of $713,112 in stock-based compensation and an increase of $350,778 in depreciation.

Net Cash Used In Investing Activities

Net cash used in investing activities was $3,391,888 for the year ended December 31, 2024, as compared with $2,404,440 for the year ended December 31, 2023. The increase in cash used in investing activities of $987,448 was principally due to the purchase of land for the Mustang mill site of $1,982,093 in connection with the acquisition of PRC.

Net Cash Provided By Financing Activities

Net cash provided by financing activities was $8,152,328 for the year ended December 31, 2024, as compared with $5,844,411 for the year ended December 31, 2023. The increase in cash provided by financing activities of $2,307,917 was principally due to a $3,601,414 increase in proceeds from warrant exercises, partially reduced by a $1,289,997 decrease in aggregate net proceeds from the private placement during the calendar year 2024 as compared to the calendar year 2023.

Asset Retirement Obligations

Our mines are subject to certain AROs, which we have recorded as liabilities. The AROs of the United States mines are subject to legal and regulatory requirements and estimates of the costs of asset retirement obligations are reviewed periodically by the applicable regulatory authorities. The ARO represents our best estimate of the present value of future reclamation costs in connection with the mineral properties.

During the year ended December 31, 2024, in connection with our San Rafael Mine and Sunday Mine Complex, we incurred additional gross and discounted asset retirement obligations of $412,534 and $80,508, respectively. We determined the aggregate gross ARO of the mineral properties to be $1,163,978 and $751,444 as of December 31, 2024 and December 31, 2023, respectively. The portion of the asset retirement obligation related to the Van 4 Mine, which is in reclamation as of December 31, 2024, and its related restricted cash are included in current liabilities and current assets, respectively, at a value of $75,057. During the year ended December 31, 2024, our internal mining operations team has been performing the Van 4 Mine reclamation work, and the State of Colorado has not yet reduced the associated asset retirement obligation amount.

The Company's asset retirement obligations are subject to legal and regulatory requirements. Estimates of the costs of reclamation are reviewed periodically by the Company and the applicable regulatory authorities. The asset retirement obligations represent the Company's estimate of the present value of future reclamation costs, discounted using a credit adjusted risk-free interest rates of 5.4% for the years ended December 31, 2024 and 2023. The net discounted aggregated values as of December 31, 2024 and 2023 were $410,098 and $316,619, respectively. On September 17, 2024 and March 13, 2025, the Company remitted $61,403 and $351,131, respectively in connection with the aforementioned 2024 incremental AROs. Financial warranties to secure AROs as of December 31, 2024 and 2023 were $812,993 and $751,444, respectively.

Oil and Gas Lease and Easement

In 2017, we entered into an oil and gas lease that became effective with respect to minerals and mineral rights owned by us of approximately 160 surface acres of our property in Colorado. As consideration for entering into the lease, the lessee has agreed to pay us a royalty from the lessee's revenue attributed to oil and gas produced, saved, and sold attributable to the net mineral interest. We have also received cash payments from the lessee related to the easement that we are recognizing incrementally over the eight year term of the easement.

On June 23, 2020, the same entity as discussed above elected to extend the oil and gas lease easement for three additional years, through July 2023. This was done to provide additional time in order to complete well construction and commence oil and gas production. During 2021, the operator completed a first set of eight (8) wells which commenced oil and gas production by August 2021. During 2022, the operator completed a second set of eight (8) wells which commenced oil and gas production by August 2022. All sixteen (16) wells remain in production and monthly royalty payments will be ongoing in perpetuity as long as oil and/or gas are produced from the pooled unit containing these sixteen (16) wells.

During the years ended December 31, 2024 and 2023, we recognized aggregate revenue of $183,803 and $431,065, respectively, under these oil and gas lease arrangements.

Related Party Transactions

We have transacted with related parties pursuant to service arrangements in the ordinary course of business, as follows:

Prior to the acquisition of Black Range, Mr. George Glasier, the Company's CEO, who is also a director of the Company ("Seller"), transferred his interest in a former joint venture with Ablation Technologies, LLC to Black Range. In connection with the transfer, Black Range issued 25 million shares of Black Range common stock to Seller and committed to pay $309,138 (AUD $500,000) to Seller within 60 days of the first commercial application of the Kinetic Separation technology. We assumed this contingent payment obligation in connection with the acquisition of Black Range. At the date of the acquisition of Black Range, this contingent obligation was determined to be probable. Since the deferred contingent consideration obligation is probable and the amount is estimable, we recorded the deferred contingent consideration as an assumed liability in the amount of $309,138 and $340,650 as of December 31, 2024 and 2023, respectively.

On October 1, 2024, Western, through its wholly owned subsidiary, Western Utah, executed a binding stock purchase agreement (the "PRC Agreement") to purchase 100% of the shares of PRC from a private investor group and thereby acquire an 880 acre property located in Montrose County, Colorado, where a uranium processing plant was previously licensed but never constructed. George Glasier, the President, CEO and a director of Western, and his wife Kathleen owned 50% of the shares of PRC, and Andrew Wilder, a director of Western, indirectly owned 3% of the shares of PRC. Therefore, this transaction constitutes a related party transaction. The Company's Board of Directors established an independent committee of the Board, comprised of directors who are not considered to have an interest in the transaction. The independent committee of the Board oversaw the negotiation and approved the entering into the PRC Agreement on behalf of Western. Of the total cash paid to the sellers, $414,584 was paid to George Glasier and $24,875 was paid to an affiliate of Andrew Wilder.

We have multiple lease arrangements with Silver Hawk Ltd., an entity which is owned by George Glasier and his wife Kathleen Glasier. These leases, which are all on a month-to-month basis, are for our rental of office, workshop, warehouse and employee housing facilities. We incurred rent expense of $106,500 and $71,700 in connection with these arrangement for the years ended December 31, 2024 and 2023, respectively.

During the years ended December 31, 2024 and 2023, we purchased equipment from Silver Hawk Ltd. for $9,000 and $25,800, respectively.

We are obligated to pay Mr. Glasier for reimbursable expenses in the amount of $83,554 and $84,040, included within accounts payable and accrued expenses, as of December 31, 2024 and 2023, respectively.

Going Concern

With the exception of the quarter ended June 30, 2022, we had incurred losses from our operations. During the years ended December 31, 2024 and 2023, we generated net losses of $10,112,037 and $4,942,594, respectively. We expect to generate operating losses for the foreseeable future as we incur expenses to bring our mineral processing facilities online and further expand our mining operations. As of December 31, 2024 and 2023, we had an accumulated deficit of $28,929,894 and $18,817,857, respectively, and working capital of $5,240,584 and $8,970,434, respectively.

Since inception, we have met our liquidity requirements principally through the issuance of notes, the sale of our common shares and from limited revenue sources. During the year ended December 31, 2024, we received $4,605,458 in proceeds from the exercise of our common share warrants. During November 2024, we closed a brokered private placement of 4,142,906 units at a price of $0.94 (CAD $1.32) per unit. The aggregate net proceeds raised in the private placement amounted to $3,546,870 (CAD $4,975,966).

Our ability to continue our operations and to pay our obligations when they become due is contingent upon us obtaining additional financing. Management's plans include seeking to procure additional funds through debt and equity financings, to secure regulatory approval licenses to fully utilize our Kinetic Separation, to permit and construct the Mustang Minerals Processing Plant for the processing of uranium and vanadium to generate operating cash flows. We will also require capital to fund the ongoing in-house mining operations at the Sunday Mine Complex.

There are no assurances that we will be able to raise capital on terms acceptable to us or at all, or that cash flows generated from our operations will be sufficient to meet our current operating costs and required debt service. If we are unable to obtain sufficient amounts of additional capital, we may be required to reduce the scope of our planned product development, which could harm our financial condition and operating results, or we may not be able to continue to fund our ongoing operations. These conditions raise substantial doubt about our ability to continue as a going concern to sustain operations for at least one year from the issuance of the accompanying financial statements. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Off Balance Sheet Arrangements

As of December 31, 2024, there were no off-balance sheet transactions. We have not entered into any specialized financial agreements to minimize our investment risk, currency risk or commodity risk.

Critical Accounting Estimates and Policies

The preparation of these consolidated financial statements requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and reported amounts of expenses during the reporting period.

Significant assumptions about the future and other sources of estimation uncertainty that management has made at the end of the reporting period, that could result in a material adjustment to the carrying amounts of assets and liabilities, in the event that actual results differ from assumptions made, include, but are not limited to, the following: fair value of transactions involving common shares, assessment of the useful life and evaluation for impairment of intangible assets, valuation and impairment assessments of mineral properties and equipment, deferred contingent consideration, asset retirement obligations, valuation of stock-based compensation, and HST. Other areas requiring estimates include allocations of expenditures, depletion and amortization of mineral rights and properties.