TORONTO, July 27, 2020 /PRNewswire/ - Denison Mines
Corp. ("Denison" or the "Company") (TSX: DML) (NYSE
American: DNN) is pleased to announce the successful resumption of
In-Situ Recovery ("ISR") field testing activities focused on the
high-grade Phoenix uranium deposit
("Phoenix"), at the Company's 90% owned Wheeler River Uranium
Project ("Wheeler River"). The ISR field test work planned
for 2020 (the "2020 Field Test") is intended to build additional
confidence in the results of an independent hydrogeologic model
developed for the deposit, and to support further field work
expected to be required for the completion of a future Feasibility
Study ("FS"). The hydrogeologic model developed for
Phoenix is based on actual field
data collected during an extensive field test program completed at
Phoenix in 2019 (the "2019 Field
Test"), with the model and associated simulations having already
demonstrated "proof-of-concept" for the application of the ISR
mining method at Phoenix, with
respect to potential operational extraction and injection rates
(see press release dated June 4,
2020). View PDF version
In order to ensure the Company's operations comply with all
applicable health and safety guidelines associated with the
COVID-19 pandemic, all operating procedures at the Company's
Wheeler River site have been reviewed and adapted to incorporate
physical distancing and enhanced hygiene protocols, as well as
special travel protocols designed by Denison for northern
Saskatchewan. Where applicable, the Company's protocols have
incorporated feedback received from potentially impacted
communities in northern Saskatchewan to minimize any health and safety
risks associated with travel to and from site.
David Cates, Denison's President
& CEO, commented, "Our team is excited to be back at
Phoenix to build on the great
success of our 2019 ISR Field Program – which culminated in the
development of a hydrogeologic model and simulation of an ISR
wellfield for Phoenix, by an
independent technical specialist firm, which ultimately
demonstrated 'proof of concept' for the use of ISR mining at
Phoenix. Over the last several months we have developed
extensive health and safety protocols and procedures, in response
to the COVID-19 pandemic, to ensure that a return to work at the
Wheeler River site can be achieved safely for our staff and
contractors, as well as the northern communities that we travel
through to access the site. With the continuation of ISR
field testing at Phoenix in 2020
we hope to minimize the impact of COVID-19 related disruptions to
the overall project development schedule and environmental
assessment process."
2020 ISR Field Test
The 2020 Field Test is fully funded and is included in the
Company's evaluation budget contained within the Company's current
outlook and operating plan for 2020 (see the Company's Management
Discussion and Analysis for the period ended March 31, 2020). The purpose of the additional
test work is to further evaluate and de-risk the ISR mining
conditions present at Phoenix, by
supplementing the extensive dataset acquired as part of the 2019
Field Test. Hydrogeological data collected as part of the
2020 Field Test is expected to build additional confidence in the
Company's understanding of the fluid pathways within Test Area 1
and Test Area 2, to further validate the Company's hydrogeologic
model for Phoenix, and to prepare
for field tests in future years, which are expected to support a
future FS.
Key elements of the 2020 Field Test include:
- Additional pump/injection tests within Test Area 1 and Test
Area 2 of the Phoenix
deposit;
- Groundwater sampling to characterize baseline hydrogeochemistry
in the deposit area to support the planning and permitting of a
potential future in-ground lixiviant test or ISR
demonstration;
- Groundwater sampling to support the development of reactive
transport models to determine the overall dissolution rate of the
ore and flow of lixiviant through the formation;
- Collection and analysis of additional matrix permeability data
from drill core previously recovered from within Test Area 1 and
Test Area 2, to support further refinement of hydrogeological
models with an enhanced understanding of both large- and
small-scale fluid flow pathways.
- Rock mechanics tests to collect data to aid in evaluating the
potential utility of certain permeability enhancement
techniques.
COVID-19 Precautions
During the month of June, the Company's Occupational Health and
Safety Committee in Saskatoon
developed a comprehensive guide for the safe resumption of work at
the Wheeler River site. The protocols consider the unique
health and safety risks associated with operating a remote work
camp amidst the ongoing COVID-19 pandemic. Public health
guidelines and best practices have been incorporated into the
Company's plans, which have been reviewed by the Company's Vice
President Operations, President & CEO, and the Environmental
Health and Safety Committee of the Board of Directors.
In addition to an extensive review of work procedures on site,
the Company has designed special travel protocols to minimize any
health and safety risks associated with travel to and from site
through various communities in northern Saskatchewan. These
protocols were developed in consultation with community leaders so
as to be coordinated with any localized travel restrictions or
roadblocks implemented to minimize the risk of COVID-19
transmission in northern Saskatchewan.
The Company is committed to ensuring that the Wheeler River site
is a safe operating environment for its staff and contractors and
that the Company's field activities do not compromise the health
and safety of the residents of northern Saskatchewan. Despite
the Company's current intentions, it is possible that the 2020
Field Test may be disrupted by the continuously evolving social
and/or economic disruptions associated with the COVID-19 pandemic,
which are outside of the control of the Company – for example, the
ability of Company or contractor staff to attend to the site,
Provincial or local travel restrictions, and changing public health
guidelines.
About Wheeler River
Wheeler River is the largest undeveloped uranium project in
the infrastructure rich eastern portion of the Athabasca Basin region, in northern
Saskatchewan – including combined
Indicated Mineral Resources of 132.1 million pounds
U3O8 (1,809,000 tonnes at an average grade of
3.3% U3O8), plus combined Inferred Mineral
Resources of 3.0 million pounds U3O8 (82,000
tonnes at an average grade of 1.7% U3O8). The
project is host to the high-grade Phoenix and Gryphon uranium deposits,
discovered by Denison in 2008 and 2014, respectively, and is a
joint venture between Denison (90% and operator) and JCU
(Canada) Exploration Company
Limited (10%).
A PFS was completed for Wheeler River in late 2018,
considering the potential economic merit of developing the
Phoenix deposit as an ISR
operation and the Gryphon deposit as a conventional underground
mining operation. Taken together, the project is estimated to
have mine production of 109.4 million pounds
U3O8 over a 14-year mine life, with a base
case pre-tax NPV of $1.31 billion (8%
discount rate), Internal Rate of Return ("IRR") of 38.7%, and
initial pre-production capital expenditures of $322.5 million. The Phoenix ISR operation is
estimated to have a stand-alone base case pre-tax NPV of
$930.4 million (8% discount rate),
IRR of 43.3%, initial pre-production capital expenditures of
$322.5 million, and industry leading
average operating costs of US$3.33/lb
U3O8. The PFS is prepared on a project
(100% ownership) and pre-tax basis, as each of the partners to the
Wheeler River Joint Venture are subject to different tax and other
obligations.
Further details regarding the PFS, including additional
scientific and technical information, as well as after-tax results
attributable to Denison's ownership interest, are described in
greater detail in the NI 43-101 Technical Report titled
"Pre-feasibility Study for the Wheeler River Uranium Project,
Saskatchewan, Canada" dated
October 30, 2018 with an effective
date of September 24, 2018. A
copy of this report is available on Denison's website and under its
profile on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov/edgar.shtml.
About Denison
Denison is a uranium exploration and development company with
interests focused in the Athabasca
Basin region of northern Saskatchewan,
Canada. In addition to the Wheeler River project, Denison's
Athabasca Basin exploration
portfolio consists of numerous projects covering over 250,000
hectares. Denison's interests in the Athabasca Basin also include a 22.5% ownership
interest in the McClean Lake joint venture ("MLJV"), which includes
several uranium deposits and the McClean Lake uranium mill, which
is contracted to process the ore from the Cigar Lake mine under a
toll milling agreement, plus a 25.17% interest in the Midwest and
Midwest A deposits, and a 66.71% interest in the J Zone and Huskie
deposits on the Waterbury Lake property. Each of Midwest, Midwest
A, J Zone and Huskie are located within 20 kilometres of the
McClean Lake mill.
Denison is engaged in mine decommissioning and environmental
services through its Closed Mines group (formerly Denison
Environmental Services), which manages Denison's Elliot Lake reclamation projects and provides
post-closure mine care and maintenance services to a variety of
industry and government clients.
Denison is also the manager of Uranium Participation Corp., a
publicly traded company which invests in uranium oxide and uranium
hexafluoride.
Qualified Persons
The technical information contained in this release has been
reviewed and approved by Mr. David
Bronkhorst, P.Eng, Denison's Vice President, Operations, who
is a Qualified Person in accordance with the requirements of NI
43-101.
Cautionary Statement Regarding Forward-Looking
Statements
Certain information contained in this news release
constitutes 'forward-looking information', within the meaning of
the applicable United States and
Canadian legislation concerning the business, operations and
financial performance and condition of Denison.
Generally, these forward-looking statements can be identified
by the use of forward-looking terminology such as 'plans',
'expects', 'budget', 'scheduled', 'estimates', 'forecasts',
'intends', 'anticipates', or 'believes', or the negatives and/or
variations of such words and phrases, or state that certain
actions, events or results 'may', 'could', 'would', 'might' or
'will be taken', 'occur', 'be achieved' or 'has the potential
to'.
In particular, this news release contains forward-looking
information pertaining to the following: the results of the 2019
Field Test; the hydrogeologic model and its underlying assumptions;
the 2020 Field Test, including its intended scope and timing,
objectives and evaluation interpretations; the duration and scope
of impacts of the COVID-19 pandemic and affiliated operational
adjustments; the current and continued use and availability of
third party technologies for testing; the results of the PFS and
expectations with respect thereto; development and expansion plans
and objectives, including plans for a feasibility study; and
expectations regarding its joint venture ownership interests and
the continuity of its agreements with its partners.
Forward looking statements are based on the opinions and
estimates of management as of the date such statements are made,
and they are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of Denison to be materially different
from those expressed or implied by such forward-looking statements.
For example, the results of the 2019 Field Test, hydrogeologic
model and/or 2020 Field Test discussed herein may not be maintained
after further testing or be representative of actual conditions
within the Phoenix deposit.
In addition, Denison may decide or otherwise be required to
discontinue the 2020 Field Test or other testing, evaluation and
development work at Wheeler River if it is unable to maintain or
otherwise secure the necessary resources (such as testing
facilities, capital funding, regulatory approvals, etc.) or
operations are otherwise affected by COVID-19 and its potentially
far-reaching impacts. Denison believes that the expectations
reflected in this forward-looking information are reasonable but no
assurance can be given that these expectations will prove to be
accurate and results may differ materially from those anticipated
in this forward-looking information. For a discussion in respect of
risks and other factors that could influence forward-looking
events, please refer to the factors discussed in Denison's Annual
Information Form dated March 13, 2020
or subsequent quarterly financial reports under the heading 'Risk
Factors'. These factors are not, and should not be construed as
being exhaustive.
Accordingly, readers should not place undue reliance on
forward-looking statements. The forward-looking information
contained in this news release is expressly qualified by this
cautionary statement. Any forward-looking information and the
assumptions made with respect thereto speaks only as of the date of
this news release. Denison does not undertake any obligation to
publicly update or revise any forward-looking information after the
date of this news release to conform such information to actual
results or to changes in Denison's expectations except as otherwise
required by applicable legislation.
Cautionary Note to United States Investors Concerning
Estimates of Measured, Indicated and Inferred Mineral Resources and
Probable Mineral Reserves: This press release may use
the terms 'measured', 'indicated' and 'inferred' mineral resources.
United States investors are
advised that while such terms have been prepared in accordance with
the definition standards on mineral reserves of the Canadian
Institute of Mining, Metallurgy and Petroleum referred to in
Canadian National Instrument 43-101 Mineral Disclosure Standards
('NI 43-101') and are recognized and required by Canadian
regulations, these terms are not defined under Industry Guide 7
under the United States Securities Act and, until recently, have
not been permitted to be used in reports and registration
statements filed with the United States Securities and Exchange
Commission ('SEC'). 'Inferred mineral resources' have a great
amount of uncertainty as to their existence, and as to their
economic and legal feasibility. It cannot be assumed that all or
any part of an inferred mineral resource will ever be upgraded to a
higher category. Under Canadian rules, estimates of inferred
mineral resources may not form the basis of feasibility or other
economic studies. United States
investors are cautioned not to assume that all or any part of
measured or indicated mineral resources will ever be converted into
mineral reserves. United States
investors are also cautioned not to assume that all or any part of
an inferred mineral resource exists, or is economically or legally
mineable. In addition, the terms "mineral reserve",
"proven mineral reserve" and "probable mineral reserve" for the
purposes of NI 43-101 differ from the definitions and allowable
usage in Industry Guide 7. Effective February 2019, the SEC adopted amendments to its
disclosure rules to modernize the mineral property disclosure
requirements for issuers whose securities are registered with the
SEC under the Exchange Act and as a result, the SEC now recognizes
estimates of "measured mineral resources", "indicated mineral
resources" and "inferred mineral resources". In addition, the SEC
has amended its definitions of "proven mineral reserves" and
"probable mineral reserves" to be "substantially similar" to the
corresponding definitions under the CIM Standards, as required
under NI 43-101. However, information regarding mineral
resources or mineral reserves in Denison's disclosure may not be
comparable to similar information made public by United States companies.
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SOURCE Denison Mines Corp.