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TWST: Could you summarize the past business of U.S. Energy in the
natural resources industry?
Mr. Larsen: Our company was actually founded by my father, Jack
Larsen, in 1966, and he is currently the CEO and the Chairman of
the Board of U.S. Energy. At that time U.S. Energy was heavily
involved in the uranium mining and contracting business. In 1970
we did a 300,000 Reg A underwriting and we've been public ever
since. With the proceeds of the uranium development and
contracting business, as well as the proceeds from the offering,
we went out and acquired controlling interest in a company in
Crested Butte, Colorado called Crested Butte Silver Mining, Inc.
In 1974, a company called Amax Inc. leased a portion of the
Crested Butte Silver Mining property also under lease to U.S.
Energy for different minerals. AMAX eventually bought that
property from the Companies and developed the Mt. Emmons property
into one of the largest deposits of molybdenum in the world on
that site. They paid our companies approximately 40 million in
buying the property, and with that money we continued to develop
our uranium assets during the 1980s. We also invested our money
into the development of oil and gas properties here in Wyoming as
well as in Montana and built a gold mine and mill in Nevada.
Eventually, we purchased a controlling interest in a gold
property located in Sutter Creek, California. During the early
part of the 1990s we entered into a joint venture with Kennecott
Copper of Salt Lake City, in developing some of our uranium
properties here in Wyoming. In the latter part of the 1990s, we
started focusing on natural gas exploration. And the reason for
that is because it melded with out background in uranium
exploration and production. We knew that our new competition in
the uranium energy business was natural gas for the production of
electricity. (Uranium produces approximately 20% of the U.S.
electrical generation. Natural gas currently produces 17% and is
projected to go much higher, to 36% by 2020.) At that time, we
redirected our efforts toward natural gas exploration and
production, and formed a subsidiary, Rocky Mountain Gas, Inc., to
acquire acreage prospective for natural gas. Gas is the main
focus of U.S. Energy now. I guess to summarize our history, we've
been operating in natural resources for over thirty years wherein
we've been able to recognize opportunity and shift corporate
gears to take advantage of it.
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