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9ENERGY FUELS RESOURCES <br />CORPORATION <br />remained steady at % gallon per minute to the bottom of the hole, 30 feet below the 3 d rim <br />sandstone, and added very little formation water during the three hours after drilling and during <br />probing. The total depth of the hole was 600 feet from surface. <br />MW West Intermediate <br />The pilot hole of the western intermediate monitor well located downdip of the West Sunday <br />underground mine workings was completed on September 24th, 2012. The hole was completed <br />through the same 3rd rim sandstone of the Salt Wash Member of the Morrison Formation as the <br />ambient monitor well located 1,300 feet to the north - northwest. The target mining sandstone <br />here thinned to approximately 33 feet (700 to 733 feet from surface). The hole deviated 25 feet <br />due north and is roughly 1,000 feet south of the West Sunday underground mine workings. The <br />dip of the bedding in the area shallows moving southward and is approximately 7 to 8 degrees <br />south - southwest. <br />Consistent with the ambient monitor well located updip, the intermediate well encountered <br />minor water in the Brushy Basin Member of the Morrison Formation, and similarly little water in <br />the Salt Wash itself. An inflatable packer was installed at 680 feet from surface to isolate the Salt <br />Wash from the water above. Water below the packer was airlifted from the hole. During <br />airlifting, the water discharge from the hole was a continuous 3/$ gallon per minute. However, <br />the seal between the packer and hole wall was most likely leaking as the static level in the water <br />above the packer was falling steadily and the discharged water remained a red color and never <br />cleaned up to indicate it was making only formation water from the Salt Wash. Any water <br />coming from the 3`d rim sandstone of the Salt Wash is less than approximately % gallon per <br />minute. The crew reset the packer two more times at slightly different depths in an attempt to <br />get a better seal; however, there was no noticeable difference in the results. <br />MW East Compliance <br />The pilot hole for the eastern compliance well was completed on October 9, 2012. The location <br />of this hole is approximately 6,000 feet southeast of the West Intermediate well, near the <br />southeast corner of the property. Like the other wells, the hole encountered perched <br />groundwater in sandstone units above the target horizon (in the Burro Canyon Formation and <br />lenses in the Brushy Basin). The hole was deep enough to penetrate through the 3rd rim <br />sandstone of the Salt Wash Member of the Morrison Formation. The target mining sandstone <br />unit here contained a thicker mudstone split resulting in two separate sandstone lenses. <br />Lnerlg� l ucl� Ke:SOUrecJ (_.oq)ora11011 2_'D L11011 Blvd.. Suite 600 <br />���iw°.energyfi�els.con� Lakewood, Colorado 80228 <br />Phone: 303-974-2140 <br />Fax: 303 - 974 -2141 <br />