The head of a junior mining company whose bid to explore for uranium in the Northwest Territories was recently rejected by Ottawa believes the decision is just a setback for the project.

Ur-Energy Inc. president Bill Boberg told CBC News that he understands why Indian and Northern Affairs Minister Chuck Strahl accepted an environmental impact review board's recommendation to reject his company's application to explore for uranium in the Upper Thelon basin.

"We're viewing it at this point in time as a delay. We do feel that eventually we should be able to properly move on our claims and to explore our claims, particularly since they have been defined as legally valid mining claims," Boberg said Monday.

"It's just a matter of making the determination as to when we can actually do that and what we need to do to get to that point."

At the same time, Boberg said the decision sends an unfortunate message to the mining industry that the Northwest Territories is not a friendly place.

Boberg said he plans to sit down with company stakeholders to determine the best way to move forward with the Upper Thelon basin project. Ur-Energy has headquarters in Colorado and Ontario.

Last week, Strahl announced that he accepted the Mackenzie Valley Environmental Impact Review Board's controversial decision to reject Ur-Energy's application to conduct an exploratory drill near the basin, in the territory's eastern region.

In May, the board ruled such development would have an unacceptable cultural and spiritual impact on the area's Lutselk'e Dene people, who describe the area as "the place where God began."

Although Strahl turned down Ur-Energy's application, he asked his department to come up with a plan that could allow development in some areas of the basin. That plan is due by the end of November.